But he may still have to sell them. This will create an overhang that won’t do wonders for their already demolished stock prices.
CNBC’s Charlie Gasparino reports:
Media investor Sumner Redstone, hoping to avoid having to sell Viacom and CBS, will first try to sell other assets of his holding company, National Amusements, if efforts to renegotiate a $1.6 billion loan fall through, people close to the company told CNBC.
Redstone, facing a severe cash crunch due to the sharp drop in CBS and Viacom stock, sold $233 million of his holdings in both companies earlier this month to avoid violating terms of the National Amusement’s loan.
Redstone told CNBC Wednesday that he has no plans to sell any more stock and has no interest in selling the companies outright. As a result, Redstone is continuing to try to renegotiate the $1.6 billion bank debt, which one person close to the company described as “difficult.”
If talks on the loan fall through, as this person thinks they will, his advisers will look to sell other assets held by National Amusements, which includes a movie theatre chain.
Although a CBS/Viacom sale is considered a last resort, it is among the alternatives being weighed by the Redstone’s advisers, despite his denials.
One of National Amusements advisers is Rothschild, the European investment bank, where former Bear Stearns CEO Allan Schwartz now works, at least on a temporary basis. Schwartz is one of Wall Street best media investment bankers and is playing a role in advising National Amusements on strategy.
The $1.6 billion debt was arranged by Bank of America and others. Half of that, $800 million, will need to be repaid by year’s end.