Paramount stake sale could hamper deal for Viacom: National Amusements

Fri Jul 15, 2016 12:26pm EDT
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By Jessica Toonkel

(Reuters) - Sumner Redstone's privately held movie theater company said on Friday it opposes the sale of a minority stake in Viacom Inc's Paramount Pictures, because such a transaction could hurt the chances of a deal involving all of Viacom.

National Amusements Inc, through which the 93-year-old media mogul owns 80 percent of Viacom, said in a statement that Paramount was "one of Viacom’s most valuable assets" and a stake sale "would chill the interest of parties that may be interested in a larger transaction involving all of Viacom."

Redstone also owns 80 percent of the voting shares of CBS Corp through National Amusements. Viacom split off from CBS in 2006, but many investors have said they hope the two will merge again.

CBS Chief Executive Les Moonves, whom some expect would be tapped to head the combined company if that merger were to happen, is said to be interested in owning a movie studio, according to sources familiar with the situation. CBS declined to comment.

A Viacom spokesman said it was "beyond understanding" that National Amusements would continue to interfere with a potential Paramount deal that would create a long-term value "without even waiting for the facts."

The statement comes two days after Reuters was first to report that Dalian Wanda Group is interested in buying the Paramount stake.

Wanda's interest adds urgency to deliberations over Paramount's future, which has become the flashpoint of a bitter feud between Viacom Chief Executive Philippe Dauman and Redstone, the company's controlling shareholder. Redstone has so far opposed the sale, which is not possible without his consent.

Last month, National Amusements moved to replace Dauman and four other directors on Viacom's board, an action that is being contested in a Delaware court.   Continued...

Sumner Redstone, executive chairman of Viacom Inc and CBS Corp, poses for a photo after answering questions at the Milken Institute Global Conference in Beverly Hills, California, U.S. May 2, 2012. REUTERS/Danny Moloshok/File Photo