The acquisition is Amazon’s biggest acquisition since it agreed to buy Whole Foods in 2017 for $13.7 billion.
Amazon.com Inc. said it closed on the $8.5 billion acquisition of movie studio Metro-Goldwyn-Mayer after regulators refused to question the deal, cementing the company’s biggest acquisition in five years.
The shutdown, announced Thursday in a statement on the company’s website, marks the latest deal by a US tech giant to gain approval despite criticism that the companies have been able to gobble up smaller companies with Little resistance from competition enforcers.
European Union regulators signed off on the MGM deal on Tuesday after finding it raised no competition concerns. In the US, the deadline for the Federal Trade Commission to challenge the deal before it was finalized passed without action by the agency.
The FTC still has the authority to sue to block the deal in the future if a majority of commissioners vote to sue. The commission is currently split between two Republicans and two Democrats, including Chairman Lina Khan, while the President’s candidate Joe Biden for the fifth seat awaits Senate confirmation.
Amazon shares were little changed at $3,062.67 at 9:35 a.m. in New York.
Amazon agreed in May to buy MGM to deepen its library of streaming content, one of the perks of being a member of the company’s Prime delivery service. MGM, the studio behind the James Bond franchise, adds a 25,000-hour back catalog that Amazon could spread between its Prime Video offering or its free, ad-supported streaming IMDb TV.
The acquisition is Amazon’s biggest acquisition since it agreed to buy Whole Foods in 2017 for $13.7 billion. In 2020 and 2021 alone, Amazon spent a combined $24 billion on video and music for its streaming services.
Previously, Amazon acquired smaller startups it perceived as a threat: shoe seller Zappos, for example, or Diapers.com parent Quidsi. Amazon has also courted newcomers in new lines of business, such as the gaming platform Twitch or Kiva, which makes warehouse robots.
About a month after the deal was announced, Biden appointed Khan to head the FTC, putting a fierce critic of Amazon in charge of the agency. Khan rose to prominence in the antitrust world with a 2017 article he wrote when he was a law student about Amazon’s dominance. Entitled “The Amazon Antitrust Paradox,” he traces how the online retailer came to control key infrastructure of the digital economy and how traditional antitrust analysis fails to consider the danger to competition posed by the company.
Bloomberg Intelligence analyst Jennifer Rie said in a research note that even if Khan manages to win a majority vote to challenge the MGM deal, the agency would likely lose in court. The deal does not unduly concentrate any markets or significantly alter competitive dynamics in streaming or video content, Rie said.