Paramount Decides Against Selling BET Majority Stake
Written by djfrosty on August 17, 2023
After at least five months of deliberations, Paramount Global has decided against selling a majority stake in its BET Media Group, The Hollywood Reporter has confirmed.
The move to take down the “for sale” sign for the unit — which includes the BET channel, streamer BET+ as well as VH1 and BET Studios — follows publicly expressed interest from the likes of moguls Tyler Perry, Byron Allen, Sean “Diddy” Combs and others in acquiring a majority interest. The Wall Street Journal earlier reported Paramount’s decision to end the bidding process for BET.
Perry is already in business with Paramount via a multiyear content partnership struck in 2019, while Allen has been aiming to expand his TV station empire that counts The Weather Channel and Combs has a TV presence with his Revolt network.
During Paramount’s latest earnings call, on Aug. 7, CEO Bob Bakish was asked about the status of the potential sale and didn’t address BET by name, but replied: “We’re always looking for ways to maximize shareholder value. And as we said before, that might involve divesting, acquiring or potentially partnering on assets all of which we’ve done. But other than that, I’m not going to comment on anything specifically.”
The company has owned BET since 2000, when the Sumner Redstone-led firm then named Viacom snapped up Black Entertainment Television for $2.3 billion in stock and $570 million in debt. At the time, the BET channel was carried in 62.4 million households domestically.
For the past several years, Paramount has been looking to slim down its collection of assets in order to scale up in streaming and burnish its core entertainment portfolio (Paramount Pictures as well as CBS, Showtime, Nickelodeon, Comedy Central, MTV, BET and streamers Paramount+ and Pluto TV). That effort has boosted Paramount+ to about 61 million subscribers globally, but the streaming division still isn’t profitable, tallying $424 million in losses in the second quarter.
Earlier this month, the company struck a $1.62 billion deal with private equity giant KKR to sell off major book publisher Simon & Schuster. That sale (a yearslong effort after its first attempt was blocked by a judge over antitrust concerns) followed Paramount selling tech site CNET for $500 million in 2020, CBS’ New York BlackRock headquarters building for $760 million and CBS’ Studio City lot for $1.85 billion in 2021.
Paramount, with its large collection of linear channels, has been subject to headwinds in the industry amid the march of cord-cutting as consumers look beyond pay-TV packages to subscription streaming offerings. In the last quarter alone, more than 1.7 million subscribers were shed by the major pay-TV and cable companies (including Comcast, Charter and DirecTV), per a tally from Leichtman Research.
Affiliate and subscription revenue at Paramount’s TV Media unit was off 2 percent in its most recent quarter, the company disclosed Aug. 7, noting that the decline was “primarily reflecting the impact from subscriber declines, partially offset by pricing increases.”
This article was originally published by The Hollywood Reporter.