Paramount Global has reached a decision after extensive discussions lasting over five months – the company will not be proceeding with the sale of a majority stake in its BET Media Group, as confirmed by The Hollywood Reporter.
This choice to remove the “for sale” label from the division encompasses not only the BET channel but also the BET+ streaming platform, as well as VH1 and BET Studios. The decision comes in the wake of notable figures such as Tyler Perry, Byron Allen, Sean “Diddy” Combs, and others expressing their interest in acquiring a controlling interest. The Wall Street Journal initially reported Paramount’s move to conclude the bidding process for BET.
Tyler Perry already maintains a business relationship with Paramount through a multiyear content collaboration established in 2019. Meanwhile, Byron Allen has been actively working to expand his television station domain, which includes The Weather Channel. Similarly, Combs has made his mark in the TV landscape with his Revolt network.
During the latest earnings call conducted on August 7, Paramount’s CEO, Bob Bakish, was asked about the potential sale’s status. Although he didn’t specifically mention BET, he stated, “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”.
Paramount has held ownership of BET since 2000 when Viacom, led by Sumner Redstone at the time, acquired Black Entertainment Television for $2.3 billion in stock and $570 million in debt. At that juncture, the BET channel reached 62.4 million households within the United States.
In recent years, Paramount has been actively streamlining its asset portfolio in order to enhance its streaming capabilities and bolster its core entertainment collection, which includes Paramount Pictures, CBS, Showtime, Nickelodeon, Comedy Central, MTV, BET, Paramount+, and Pluto TV. This endeavor has propelled Paramount+ to a global subscriber count of approximately 61 million. Despite this achievement, the streaming division has yet to attain profitability, reporting a loss of US$424 million in the second quarter.
In a separate development earlier this month, the company finalized a US$1.62 billion agreement with private equity giant KKR to divest its prominent book publisher, Simon & Schuster. This deal, which followed a years-long effort after its initial attempt was thwarted by antitrust concerns, was preceded by Paramount’s sale of tech platform CNET for US$500 million in 2020, as well as the sale of CBS’ New York BlackRock headquarters building for US$760 million and CBS’ Studio City lot for US$1.85 billion in 2021.
Paramount, renowned for its array of linear channels, has encountered challenges within the industry due to the surge of cord-cutting, as consumers gravitate toward subscription-based streaming services, bypassing traditional pay-TV packages. In the previous quarter alone, major pay-TV and cable companies, including Comcast, Charter, and DirecTV, experienced a collective loss of over 1.7 million subscribers, according to data from Leichtman Research.
In its most recent quarter, Paramount’s TV Media unit witnessed a 2 percent decline in affiliate and subscription revenue. The company, in its August 7 disclosure, attributed this dip to “the impact from subscriber declines, partially offset by pricing increases”.
