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To Keep CBS, Redstone May Sell Theaters

  • Bloomberg, Wednesday, November 26, 2008 9:30 AM

Sumner Redstone may sell the theater chain owned by his National Amusements Inc. holding company to keep control of CBS and Viacom. Redstone, 85, told bankers he is willing to part with the 1,500- screen cinema chain as a possible step to raise money and meet his debt obligations.

National Amusements sold $233 million in non-voting shares of the New York-based media companies on Oct. 10 to meet debt covenants. The company is seeking to refinance $800 million in bank loans that come due next month.

But it is possible that selling the theaters won't be enough. It's unclear how much debt the theater chain has and how much its real estate is currently worth, says Chris Marangi, an analyst at Gabelli & Co. Attracting a top price for the chain also may be difficult because Redstone is a distressed seller. Marangi's firm is the second biggest holder of voting shares in CBS and Viacom after Redstone.

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