Philippe Dauman
Paul Hampartsoumian/REX Shutterstock

Calling Paramount Pictures a “crown jewel,” Viacom chairman and CEO Philippe Dauman said Monday that he hoped to have an agreement to sell a minority stake in the studio behind “Star Trek” and “Transformers” by the end of the next financial quarter.

Analysts have speculated that deep-pocketed Chinese investors such as Alibaba might be interested in buying a position in Paramount, but Dauman refused to say who was circling the studio.

“I feel very good about the kind of players that we’re talking to,” said Dauman on Monday at the Deutsche Bank media, Internet and telecom conference, adding, “It will help drive Viacom forward as well as bring out some of the value that’s not being recognized.”

Paramount cut the number of films it releases in recent years, which has taken a bite out of its market share. However, Dauman touted the studio’s library, its move into television production, and the expanding global market for film and television, while talking up Paramount’s appeal. Those attributes will enable Viacom to get a premium when selling the stake, Dauman predicted, and will allow it to “come out from the low point its been in.”

“We’re replenishing the cupboard and we’re looking to a good performance and I want to accelerate that,” said Dauman.

At another point, he argued, “Paramount as a whole is a real growth business.”

The remarks came as Dauman is feeling pressure from activist investors such as Mario Gabelli, the second-largest shareholder in Viacom behind Sumner Redstone, over the media conglomerate’s shaky performance. The stock has been battered amid concerns about the long-term health of the pay-television sector. Viacom’s holdings include MTV and Comedy Central, once dominant cable brands that have suffered ratings declines. That, in turn, has depressed Viacom’s stock — shares were trading at nearly $70 a year ago, but they were hovering above $45 on Monday.

That’s not giving Viacom enough credit, Dauman implied, saying, “You’re getting a lot of things for free when you buy our shares.”

He noted that VH1 and Nickelodeon’s viewership numbers have climbed back, and the company has strengthened its international presence.

Beyond the balance sheet, Redstone’s fading health has also been a source of drama. The Viacom founder’s former companion, Manuela Herzer, has filed a lawsuit that challenges Redstone’s mental competency. A trial is scheduled for May.

Dauman was bullish about the prospects of a new deal with Dish to carry Viacom’s cable channels. Renewal talks had been expected to be potentially rocky, but Dauman predicted a deal would be in place next quarter.

“We have a long and strong relationship,” said Dauman. “I’m very confident we’re going to get to a mutually beneficial outcome.”

New digital players are threatening the business model for cable providers and could imperil lucrative sources of revenue for content creators such as Viacom. Dauman acknowledged that the television industry has been slow to adapt to the on-demand age, but he suggested the creators are well positioned to thrive in the new environment.

“The value of content, the value of brands has not diminished,” said Dauman.

Filed Under:

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 5