Viacom CEO Sees Q2 Wrap-Up For Paramount & Dish Negotiations


The April-to-June period looks to be a busy one for Viacom. The company expects to announce its strategic partner for Paramount in the second quarter, as well as a resolution of its widely watched carriage negotiations with Dish Network, CEO Philippe Dauman told investors today at the Deutsche Bank Media, Internet & Telecom Conference.

ParamountLogo_newDauman says he feels “very good about the kind of partners we’re talking to” to buy a minority stake in Paramount. A deal “will provide strategic benefits for Paramount and likely for Viacom generally” and enable the studio to look “past the disappointing operating performance of the last several years.”

He suggested that the right partner would offer “primarily international and digital” benefits to the studio. “It’s a crown jewel out there” that has “an iconic studio with a very high-quality library which is continually being replenished.”

That could give a potential stakeholder a “once-in-a-lifetime opportunity … to get a significant interest in a major studio at a premium valuation.”

Viacom signWhile Dauman says the cash might “accelerate the development of Paramount,” he’s especially eager to “get our leverage ratio down” — which is on his mind as Viacom faces a $150 million debt maturity next month. He added that he might also look for other business opportunities.

“Whatever we don’t need for those purposes we return to shareholders,” he says.

On the Dish front, Dauman says he’s “continuing our discussions,” adding that the companies have “a long and strong relationship. I’m very confident we’re going to get to a mutually beneficial outcome.”

Last month he warned investors that there might be “hiccups” in the negotiations.

Wall Street’s been closely monitoring the talks: It would be a major blow to Viacom if it loses Dish’s 13.5 million satellite subscribers.

Small cable operators including Suddenlink have dropped the programmer’s channels including MTV, Nickelodeon, Comedy Central, and BET saying that it didn’t make sense to pay higher fees for the channels while ratings drop and many of their shows are available online to non-pay TV subscribers.

Dauman also told the investor gathering that he expects “a significant revival” for upfront ad sales at his domestic networks. Although the company has begun to reduce the amount of commercial minutes it packs into its programs, he noted that Viacom also is working to help advertisers market their wares within the shows themselves.

“We’re getting a lot of traction and feel very good about where we’re headed into the upfront,” he says.

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