National Amusements, the controlling shareholder of Paramount Global led by Shari Redstone, has received a preferred equity investment of $125 million from BDT Capital Partners.
BDT is a subsidiary of BDT & MSD Partners, a commercial bank serving family business owners and founders. Their infusion will help the company, which brought together CBS and Viacom in 2019 before changing its name to Paramount, weather a difficult stock market environment. Paramount shares are worth less than half what they were at the time of the merger, though they rose 5% in aftermarket trading on the news of BDT’s involvement.
Wall Street has been skeptical of Paramount’s streaming spending in recent months amid a broader rethink of the media industry’s approach to direct-to-consumer business.
A press release on the investment said it will “position NAI for sustainable growth and further post-pandemic recovery in its underlying operations as theater attendance continues to rise.” Specific goals include reducing interest expense and repaying a revolving loan and recent term loans. After those facilities are withdrawn, NAI’s shares in Paramount Global pledged to support those loans will be returned to NAI, and obligations to make future pledges under these facilities will be eliminated.
“Our expanded partnership with BDT and MSD reflects our strong belief in Paramount’s ability to deliver value to all shareholders,” Redstone said. “NAI believes in Paramount’s strategy and execution, and we remain committed to supporting Paramount as it takes the necessary steps to build on its success and capitalize on strategic opportunities in our industry.”
Redstone is Non-Executive Chairman of Paramount and Chairman, CEO and Chairman of NAI.
“We are pleased to partner with National Amusements in a transaction that supports their stewardship of Paramount Global,” said Byron Trott, president and co-CEO of BDT & MSD Partners. “Paramount has an incredible legacy, supported by its industry-leading media and content assets. We firmly believe in the value creation opportunities that lie ahead for the company and its shareholders.”
The investment is expected to close next week, subject to customary closing conditions.
