Chinese may pursue Paramount stake
Updated: 2016-02-25 09:34
By AMY HE in New York(China Daily USA)
US media company Viacom is looking to sell a minority stake in Paramount Pictures, and Chinese companies could be at the top of its list of potential buyers, according to reports.
A struggling Viacom said on Tuesday that it's looking for a strategic partner and that it's hoping to close a deal by June. According to The Wall Street Journal, it has received interest from at least one Asian company and a "tech player".
Industry experts said it would not be surprising if Chinese companies are interested in purchasing a stake, as a deal would help the Chinese company gain access to Hollywood, and at the same time give Paramount better leverage into the Chinese market.
"It would make sense [to partner with a Chinese buyer] if the deal included a party who can help expand Paramount Pictures — make it a bigger company, have great box office, have greater access to the second-largest market in the world and in a few years will be the largest," said Marc Ganis, co-founder of Jiaflix, which helps American studios distribute movies in China.
"It seems clear from the public announcement they're not simply looking for a financial partner, they're looking for a strategic partner," he added.
Paramount is worth approximately $4 billion, according to the Los Angeles Times, though Viacom, its parent company, could potentially make more because Paramount is one of Hollywood's original studios.
Viacom has struggled in recent years, with its stock down more than 50 percent, and the sale comes shortly after it installed new CEO Phillippe Dauman.
Wang Jianlin, chairman of Wanda Group, said during a talk at Oxford University on Tuesday that Wanda would be announcing a "major deal" on Friday, leading industry-watchers to speculate whether Wanda was going to purchase the stake in Paramount.
Wanda Group owns AMC Entertainment Holdings and agreed to buy Legendary Entertainment for $3.5 billion in January.
"They have repeatedly said they're planning on spending a lot of money and become a major global player, and this would be a step in the right direction," said Rob Cain, founder of Pacific Bridge Pictures.
If Wanda were interested in Paramount, however, it would probably want a larger share than a minority stake, Cain said.
Ganis echoed a similar opinion, saying that Wang's remark hypes the deal, and acquiring just a minority stake would be unlike him.
Aynne Kokas, media professor at the University of Virginia, said that while the deal may be a possibility, she doesn't believe they would "be making another major play for a US studio so shortly after their Legendary deal."
"That being said, there is the competition with Alibaba, so from a competitive standpoint, they might be interested," she said.