cc Friday, July 15, 2016 latimes.com/news

Redstone family reaffirms opposition to Paramount sale

By MEG JAMES TIMES STAFF WRITER

iacom Inc.’s plan to sell a stake in its histor- V ic Hollywood movie studio, Paramount Pictures, suf- fered another setback Friday when the Redstone family pub- licly reaffirmed its opposition. Sumner Redstone and his daughter, Shari Redstone, are against the proposed sale of a 49% stake in the struggling Mel- rose Avenue film studio because such a deal would complicate The Redstone family says a proposed sale of a 49% stake in Paramount Pictures other possible scenarios — such would complicate other possible transactions. (Anne Cusack / Los Angeles Times) as selling all of Viacom or recombining it with CBS Corp. Hollywood production compa- ment and board is in flux. They Despite the boardroom oppo- ny Legendary Entertainment. also don’t want Viacom to sell sition, Viacom Chief Executive Dauman hopes that fetching a off part of Paramount while the Philippe Dauman has been trying big price for the Paramount stu- studio is at a low point. Nor do to stitch together a deal. Dau- dio stake — perhaps as much as they want to introduce a signifi- man, according to knowledgea- $5 billion — would cant new investor, such as Wan- ble people, has been negotiating boost Viacom’s sagging stock da, into the mix. with Chinese entertainment gi- price. “Paramount is one of Viaco- ant Dalian Wanda Group, which But the Redstones — through m’s most valuable assets. Any appears interested in adding Par- their investment vehicle, National short-term benefits that might amount to its growing portfolio, Amusements Inc. — said such a result from a Paramount transac- which includes the AMC Enter- sale would be ill-advised at a tion would be outweighed by the tainment theater chain and the time when Viacom’s manage- severe negative impact on Viaco- m’s future strategic flexibility to day. The stock is down about “The notice period is intended best capitalize on this important 40% from levels seen two years to provide National Amusements asset,” National Amusements ago. with the opportunity to oppose said Friday in a lengthy state- Wall Street is skeptical that any such transaction,” the Red- ment. Dauman will be able to pull off stone firm said. “If required, we The Redstones appear to be the deal with Wanda, which will do so.” clearing the field for a possible would require that he successful- The film studio has been reunion of Viacom and CBS. The ly navigate major roadblocks that struggling, and some analysts be- family, through National Amuse- the Redstones have placed in his lieve that Paramount could be ments, holds nearly 80% of the path. Viacom’s stock didn’t worth more later if it could re- voting shares in both companies, budge this week after news that verse its lagging fortunes with and would likely entrust CBS Dauman was getting closer to a some hits. Next week, Paramount Chief Executive Leslie Moonves deal with Wanda. releases its big summer bet, “Star to run the merged entity. “Any deal maker knows Trek Beyond” from J.J. Abrams, Last month, National Amuse- that the Redstones are right,” said and the company hopes the film ments moved to dump Dauman investment banker Lloyd Greif. will fly high. and four other Viacom board “Viacom could say, ‘Hey, we got Viacom, and Dauman, are un- members — although that effort this great price for 49% of the der significant pressure. The was put on hold to allow a judge studio,’ but they would be taking company reports its quarterly in Delaware to determine wheth- their eye off the ball.” earnings next month and already er the Viacom board changes “They should be looking at has signaled to Wall Street that were valid. what this transaction would the numbers would be lower than “This [Paramount] decision mean for the value of the remain- originally forecast, in should not be made by individu- ing 51% of Paramount, and for part because of Paramount’s als who may be leaving the board 100% of Viacom,” Greif said. “It boxoffice blues. shortly,” National Amusements could chill the marketplace.” said in a swipe at Dauman and Greif added that a sale of 49% his supporters. of the studio could complicate Viacom, for its part, accused the daily operations of Viacom, the Redstones of meddling. which also owns MTV, Comedy “It is beyond understanding Central, Nickelodeon and TV that National Amusements would Land. continue in its attempts to inter- Last month, National Amuse- fere with a potential transaction ments unilaterally changed Via- that would create a unique oppor- com’s bylaws, requiring that any tunity to drive long-term value financial transactions involving for both Paramount and Viacom, Paramount be approved by a without even waiting for the unanimous vote by Viacom’s facts,” a Viacom spokesman said board. In addition, Viacom must Friday. give National Amusements five Viacom slipped 1.2%, or 52 days’ notice before trying to con- cents, to $44.28 a share Fri- summate any deal.