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Viacom to consider selling minority stake in Paramount film unit
[NEW YORK] Viacom Inc is considering selling a "significant" minority stake in its Paramount Pictures movie studio, Chief Executive Philippe Dauman said on Tuesday, sending the media company's shares up as much as 7 per cent.
Viacom has been approached by several strategic investors and has retained PJT Partners as its financial adviser, Mr Dauman, who replaced 92-year-old majority-owner Sumner Redstone as executive chairman earlier this month, said at a media conference.
Investors and analysts have been pushing for Viacom to consider selling all or a part of Paramount, as Viacom struggles with weak ad sales and few hit movie releases.
A report by an analyst at Bernstein on Monday valued a sale of all of Paramount at US$4 billion. It is unclear what size stake Viacom would sell.
The move by Paramount comes as investors have been pushing for a sale of all or part of the movie studio.
Investor Mario Gabelli, the second-largest owner of voting shares of Viacom, has said he would like to see the media company sell Paramount, suggesting that Alibaba Group Holding Ltd as a good partner. Similarly, activist investor SpringOwl Asset Management recently called for the company to consider a partnership for the movie studio.
Viacom shares were up 2.5 per cent at US$37.78 in afternoon trading after paring gains following Dauman's comments.