Even by Hollywood standards, MGM‘s firing of CEO Gary Barber on March 19 was dramatic and cold-hearted, catching Barber himself and his key staff members off guard. While the company remains mum on the reason for Barber’s ouster after eight years, a portrait of corporate unrest and a dispute about the future of a storied Hollywood studio is emerging based on interviews with several insiders.
Multiple sources tell The Hollywood Reporter that an unbridgeable gap had grown between Barber and board chairman Kevin Ulrich, whose Anchorage Capital Group is MGM’s largest investor. When Barber was hired to run the then-struggling home of the James Bond franchise in 2010, it was on the assumption he’d whip the studio into shape, then sell it. But eight years later, Ulrich has had a change of heart, while Barber still believes a sale is in the best interest of shareholders, which include himself, Highland Capital Management and Solus Alternative Asset Management.
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According to one source, Ulrich has said that Barber “has done a good job of stabilizing the situation financially and getting the place downsized, but he is not creative. He’s not the guy to take the place to the next level.”
Ulrich, who leads the MGM board and is said to wield considerable influence over it, had been sizing up an executive to replace Barber about a year ago. But, unable to find a suitable choice, the board agreed in October to extend Barber’s contract through 2022, making the firing all the more surprising.
Two sources say Jamie Dimon, CEO of JPMorgan Chase & Co., an MGM banker, backed Ulrich’s move to oust Barber, as did the entire board of directors, who voted on the matter Tuesday, the same day they informed Barber that his services were no longer needed. “This is obviously Kevin’s board,” says an insider. (After the publication of this story, Joe Evangelisti, a spokesman for JPMorgan Chase, stated: “This is false. Jamie was not involved at all – he had nothing to do with this decision.”)
Ulrich isn’t considered much of a Hollywood player, but the New York private equity mogul has been seen walking red carpets at movie premieres lately and attended the Oscars on March 4. Two years ago, Anchorage led a $75 million investment in Critical Content, formerly Relativity TV.
Since deciding he’d like to hold onto MGM, Ulrich has been pushing a growth mandate, and insiders say he wasn’t convinced Barber was up to the challenge. For instance, Barber is said to have been reluctant to launch a bold digital initiative like a stand-alone streaming offering.
Barber made several bold moves during his tenure as CEO, such as taking control of premium cable network Epix and bringing producers Mark Burnett and Roma Downey into the fold, giving MGM a stake in reality shows like Survivor, The Voice and Shark Tank, as well as faith-based films and TV shows. He also worked to exploit the rich MGM library, producing successful television series based on the film Fargo and Margaret Atwood’s book The Handmaid’s Tale, which won the outstanding drama series Emmy in September.
But Barber hasn’t actually grown the top or bottom line much in recent years. In 2016, revenue of $1.2 billion was the lowest in five years, while profit of $155.2 million was less than the previous year and only marginally better than in 2014.
Barber also clashed with colleagues and partners on occasion, including Burnett, MGM’s president of digital and the television group, whom insiders say was displeased with the stagnation of the film division, where revenue dropped 35 percent in 2016 while TV revenue surged 62 percent (2017 results are due March 28).
And even though Barber had hits with Bond outings Spectre and Skyfall, insiders say a rift had also developed between him and 007 producers Barbara Broccoli and Michael Wilson. The Broccoli camp ultimately refused to work with Barber, according to a source. A new entry in the spy franchise, Bond 25, starring Daniel Craig, has been set up by MGM and Eon Productions for a Nov. 8, 2019 release.
Until Barber’s exit, Warner Bros. was at the top of the list to distribute Bond 25 internationally (Barber and Warner Bros. chief Kevin Tsujihara are close associates.) Now, it is unclear whether that plan will proceed, or whether international rights will go to another studio.
Plus, while it was Burnett’s and Downey’s pet project, Barber also put himself in a bind by championing Ben-Hur (2016), which lost about $120 million for MGM and partner Paramount Pictures, and he needed to redeem himself with Tomb Raider. His fate may have been sealed when the $94 million film opened to $24 million domestically on March 16, days before Ulrich stated in a Monday exec shake-up announcement, “Now is the right time to enable the next generation of leadership who can help drive the creativity, collaboration and partnership needed to continue the company’s positive trajectory.”
A version of this story first appeared in the March 21 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.
March 21, 10:28 am Updated to clarify Bond producer rift and add a statement from a JP Morgan Chase rep.
