Talk about a terrible time to have to sell. On the same day that both CBS and Viacom warned on earnings — sending their shares tumbling — Chairman Sumner Redstone, through his National Amusements holding company, is selling $400 million worth of shares in the two companies. The firm will sell an equal dollar amount in both companies in order to pay down debt and stay in compliance with its credit agreement covenants. Taken on face value, that suggests the sale is obligatory, and not really a voluntary choice on Redstone’s part.
The news could be contributing to the intense selling pressure on both companies. Viacom is down over 18 per cent today, while CBS is down over 20 per cent.
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