Just after a freshly minted deal with Steve Spielberg's Dreamworks SKG, Reliance ADAG has reportedly restarted talks over a potential buyout or equity investment in Metro-Goldwyn-Mayer. Although Reliance through its wholly ownd subsidiary Reliance Entertainmant has been trying to conclude a deal with MGM, the deal has been struck over valuations. UBS, bankers to Reliance are trying to structure the deal "that makes the numbers work".

Though,Reliance faces obstacles if it buys all of MGM or simply makes an equity investment.An outright purchase, for instance, would trigger change-of-control provisions in the studio's credit lines that the lending banks could use to pull the funding.

The studio has revolving credit facilities totaling $450 million from JPMorgan Chase and $500 million from Merrill Lynch, the latter of which was obtained through MGM's Tom Cruise-led United Artists unit.

The daily quotes the sources as saying that MGM's owners won't sell out or bring in additional equity at anything less than the $5 billion total they paid for the studio in 2004. MGM's equity partners include Sony, Comcast, Providence Equity Partners and Texas Pacific Group.

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