A LION ON THE STREET?; MGM MAY DECIDE TO GO PUBLIC.

Byline: Dave McNary Daily News Staff Writer

Leo the Lion may be due for a comeback. Metro-Goldwyn-Mayer is expected to embark today on an attempt to recapture the glory it possessed during Hollywood's golden years.

The board of directors of privately-held MGM is scheduled to meet at the studio's Santa Monica headquarters amid widespread speculation it will hire one or more investment banks to lead an initial public offering of stock later this year. The most likely scenario would be for an IPO some time around MGM's Dec. 19 release of ``Tomorrow Never Dies,'' the 18th James Bond movie and the studio's most valuable franchise.

MGM won't comment - ``We have nothing to say about anything,'' a spokeswoman said - but investment banks have been preparing for such a development. ``I can't comment about MGM because we may be interested in participating in the IPO,'' one Wall Street entertainment analyst said.

If MGM does go public, investors will have to buy the stock not on performance but promises, according to Arthur Rockwell, an analyst with Yaeger Capital Markets. ``This is a deal that will sell on faith in management and its projections of cash flow,'' he said. ``There's not much historical data.''

Rockwell said it makes sense for MGM to tie into the Bond movie and cited the example of Pixar Animation, which went public in late 1995 when Walt Disney Co. released the Pixar-created ``Toy Story.'' Pixar's IPO was priced at $22 a share and the issue hit $48.50 on its first day of trading before falling back to more realistic levels. It closed Thursday at $16.50.

MGM's current management, led by veteran executive Frank Mancuso, has some credentials. It hit a hot streak in late 1995 and early 1996 with ``Get Shorty,'' ``GoldenEye,'' ``Leaving Las Vegas'' and ``The Birdcage'' but has struggled since then as ``Fled,'' ``Kingpin,'' ``Mulholland Falls'' and ``Turbulence'' all flopped and new production stalled while owners Credit Lyonnais auctioned off the studio.

The winning bidder was Kirk Kerkorian, who bought MGM for the third time in mid-1996 and has been gradually starting up projects again.

MGM was once Hollywood's premiere studio with classics like ``Gone With the Wind'' and ``Ben-Hur'' but its fortunes had declined by the time Kerkorian took over in the early 1970s. He purchased United Artists from Transamerica in the early 1980s, sold the combined MGM/UA to Ted Turner in 1986, bought most of it back a few months later, then sold it three years later to Italian financier Giancarlo Paretti for $1.3 billion.

Paretti lost the studio in 1991 to French bank Credit Lyonnais, which sold assets to Kerkorian and Australian broadcaster Seven Network for $1.3 billion. In a rebuilding move, MGM agreed three weeks ago to buy most of Metromedia's entertainment operations, including Orion Pictures and Goldwyn Entertainment, for $573 million.

That deal gave MGM the largest library in Hollywood with more than 4,000 titles and a few art-house releases. But except for the Bond movie, none of MGM's upcoming slate has generated much buzz. Possible 1998 hits could come from ``Mod Squad,'' ``Species II'' and ``Court Jester'' with Mike Myers.

Funds from an IPO would likely be used to boost movie production and jump-start the TV side of MGM, which has no network shows. If all goes well, MGM could start acting like its larger rivals again by expanding into large-scale merchandising of its massive array of properties, which include the Leo logo and three highly successful movie series: James Bond, the Pink Panther and Rocky.

CAPTION(S):

3 Photos, box

Photo: (1) Ben-hur

(2) Rain Man

(3) Dances with Wolves

Box: MGM's piece of Hollywood history