Sumner Redstone will own less of Viacom Inc. (NYSE:VIA), but his influence on the media giant will continue. His imprint as chairman of Viacom with the stewardship of CEO Philippe Dauman will be seen Tuesday when the New York-based company is expected to announce third-quarter earnings.
With a tough advertising market, Viacom and its media brethren still are feeling the pinch, but the market is expecting the company to announce earnings of 56 cents a share. Last quarter, Viacom saw its net earnings fall 32%, to $277 million, while total revenue fell 14%, to $3.3 billion.
The only dealmaking Viacom has been involved with lately involves Redstone's holding company, National Amusement Inc.'s divestment of a partial stake in the New York media conglomerate, valued at $600 million. (Subscribers to The Deal Pipeline may read more here.) The move would still leave Redstone through National Amusement a controlling interest in both Viacom and CBS Corp. (NYSE:CBS).
As far as other short-term deals, Dauman feels acquisitions are out of the picture for Viacom. Dauman told Reuters on Oct. 20:
"As far as we're concerned, we're focused on growing our brands, growing our business. We have tremendous brands with a lot of room for growth both in the U.S. and internationally. It's a big opportunity for us. We've been involved in a lot of consolidation in our corporate history. The record of success in media consolidation has not been all that great for the most part so for ourselves we think the better strategy is to grow organically."
And that organic growth may be partially shouldered by Viacom's release of the much anticipated video game, "The Beatles: Rock Band," in September, which sold 595,000 units in its first 25 days in the U.S., according to research firm NPD Group Inc. The numbers are impressive, but analysts are still concerned with the major production costs of the latest version of the video game, which include a Beatles song license that reportedly costs upwards of $50 million. - Gerald Magpily
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Um, hello? "The only dealmaking Viacom has been involved with lately involves Redstone's holding company, National Amusement Inc.'s divestment of a partial stake in the New York media conglomerate, valued at $600 million"? Nickelodeon, a division of Viacom, bought the Teenage Mutant Ninja Turtles franchise this year for around $60 mil.