The objective for media mogul Sumner Redstone is to hold on to his controlling stakes in both Viacom Corp. and CBS Corp. And now, according to the Financial Times, which cites people familiar with the situation, Redstone may have found a way to that with a reported agreement to sell part of National Amusements Inc.'s 1,500 movie theaters. The move would generate the funds needed to make a payment for the $800 million National Amusements owes, avoiding more divestments of Redstone's stake in CBS and Viacom.
Continue reading below
The FT says the possible sale in National Amusements may possibly include 19 theaters in the U.K., and a deal could give Redstone's National Amusements the opportunity to extend the deadline of its mid-December due date of a partial payment.
The possible National Amusements divestment contradicts a Wall Street Journal report earlier this week that predicted that Redstone would likely not be able to meet its deadline on its debt before the end of the year. Analysts say that National Amusement is worth between $500 million and $700 million, so a partial sale would certainly provide Redstone enough capital to keep lenders off his back. At the same time, the troubled global economy and a tight credit market would certainly hurt the value of any bids compared to doing a deal just six months ago. - Gerald Magpily
See FT.com article
