Yahoo Finance’s Allie Canal joins the Live show to discuss reports that Paramount is weighing the sale of a majority stake in BET Media Group.
Video Transcript
JARED BLIKRE: Welcome back. A possible shakeup in the media world. Paramount Global is reportedly weighing a sale of BET Media Group, which is comprised of BET cable network and studio streaming services BET Plus and cable network VH1. Yahoo Finance’s Allie Canal has the details. And Allie, we’ve seen a lot of these moves. Maybe there’s a little bit of consolidation going on in the industry. What are the details here?
ALLIE CANAL: There are talks of consolidation. That has not happened yet. This is a report from the Wall Street Journal.
I did reach out to Paramount for comment. Did not hear back at this time. But a potential majority stake sale for BET Media Group would be pretty significant. Because if we take a look at this umbrella, you have the Bet channel, VH1, BET Plus.
Tyler Perry is one person of interest that is reportedly in talks for that majority stake. Perry does have a current deal with Paramount that he struck in 2017. That’s said to be ending soon. Many of his movies and TV shows air on the BET channel. So this type of partnership would make sense.
But there are also others that are interested, like media mogul Byron Allen. He owns The Weather Channel, a number of the local TV stations, and he has expressed that he is interested in this stake. So another possible buyer there.
And according to this report, if this deal goes through, Paramount would maintain a minority stake, as well as a commercial partnership. But speaking of minority investments, it’s pretty interesting here with BET. Because within that umbrella that I just mentioned, there are minority stakeholders. So Rashida Jones, for example, she’s a stakeholder of BET studios. Tyler Perry, he’s a minority investor of BET Plus. So even if Paramount wanted to take BET Plus and merge it with Paramount Plus, like we saw recently with Paramount Plus and Showtime, these minority stakeholders would complicate that.
So we’ll see if anything happens. But right now, this is early days, early discussions. It’s nothing official at the moment.
JULIE HYMAN: So why would they want to sell it then? Is it because of the complications of integrating it further into the business? I mean, what’s the value of this? Do we even have any idea? What can you tell us?
ALLIE CANAL: Well, Paramount is at this critical moment right now. They’re really evaluating all the assets of their business. They’re really evaluating their strategy moving forward.
And I think number one is cash. Paramount wants cash. They want to really build up Paramount Plus, fund that streaming service.
I will say that right now, interest rates and borrowing costs are very high. This is a very difficult deal making environment. So I think that could be one potential threat to a deal happening right now. Maybe it would delay it a little bit.
But Paramount did buy BET in 2000 for $2.3 billion. They’re going to want to sell it for more than they purchased. But whether or not they’ll be able to do that in this environment, I’m not quite sure as of yet.
But we do know that Bob Bakish, he’s very open to consolidation. He said, this is something that is going to be happening across the media landscape. So I’m sure these discussions are in talks right now.
JULIE HYMAN: All right. Selling something for more than you bought it. That’s the ideal.
ALLIE CANAL: That’s the goal.
