Paramount Global continues to be “very open-minded” about potential consolidation opportunities, according to the company’s CFO, Naveen Chopra.
“It’s probably unwise to bet against consolidation in the media industry or really any industry, for that matter,” Chopra noted during a Gabelli Funds media conference this week. “Whether Paramount is a seller of assets into consolidation or whether we are a consolidator of assets, we’ll have to see. But… we remain very open-minded to those possibilities, because they can be very effective ways of maximizing shareholder value.”
A broad sell-off strategy beyond divesting “non-core” assets appears unlikely at this time, given that the company reportedly rejected a $3-billion offer for Showtime as recently as this February, and is in the process of debuting a Paramount+ with Showtime streaming bundle.
But Chopra again confirmed that Paramount has put book publisher Simon & Schuster back on the market, and that the company “sees a track” to potentially closing a transaction this year — news first revealed during Paramount’s earnings call in May.
Paramount dropped its $2.2-billion deal to sell Simon & Schuster to Bertelsmann’s Penguin Random House last November, after the Department of Justice prevailed in federal court in its lawsuit to block the merger, arguing that it would substantially lessen competition in the book publishing market.
The company is now “deep into the marketing process” for a “sizable transaction,” with strong interest from financial and strategic buyers driving a “very competitive” process, Chopra said.
Paramount has said that S&S does not with its strategic emphasis on video.
At the same time, the company is reportedly considering selling a majority stake in BET Media Group, owner of the BET cable network and studio, VH1 and the BET+ streaming service, as a means of raising more capital to spend on programming for Paramount+ and its Pluto TV FAST streamer.
Paramount+ is set to debut an $11.99-per-month bundle with Showtime on June 27, which will be ad-free except for live TV and a few shows, and phase out Showtime’s streaming service in this year’s second half. The ad-supported “Essential” version of Paramount+, which excludes Showtime, will continue, priced at $5.99 per month, a dollar higher than currently.
Paramount Global, which lost $1.7 billion in the first quarter, including losses of $575 million in its streaming business, and has struggled to raise its share price, has divested its CBS Black Rock headquarters in New York City and Television City in Los Angeles, and is considering a sale of the CBS Broadcast Center on NYC’s West 57th Street.
But Chopra point out that the company has also been engaged in forming partnerships, including a new one with Verizon+ Play and others with Walmart+, Amazon’s Prime Video Channels and Delta Airlines.