Paramount turned down Tyler Perry’s 2 billion dollar offer to buy BET

Paramount turned down Tyler Perry’s 2 billion dollar offer to buy BET.

For the past several years, Paramount has been looking to slim down its collection of assets in order to scale up in streaming and burnish its core entertainment portfolio (Paramount Pictures as well as CBS, Showtime, Nickelodeon, Comedy Central, MTV, BET and streamers Paramount+ and Pluto TV). That effort has boosted Paramount+ to about 61 million subscribers globally, but the streaming division still isn’t profitable, tallying $424 million in losses in the second quarter.

One of the most significant entertainment media sales in recent years has apparently been called off. Moreover, new reports from the New York Post indicate that Paramount is no longer selling BET, which was a prospect that bolstered Black entrepreneurs, businessmen, and entertainers to take ownership of the Black-centered network. Not only that, but the cancellation of a $3 billion auction for BET was reportedly because Tyler Perry’s offer for it was too low. Many looked to him as the creative who seemed best poised to acquire the company under his leadership. However, with this new report, it seems like its future still hangs in the balance.

Earlier this month, the company struck a $1.62 billion deal with private equity giant KKR to sell off major book publisher Simon & Schuster. That sale (a yearslong effort after its first attempt was blocked by a judge over antitrust concerns) followed Paramount selling tech site CNET for $500 million in 2020, CBS’ New York BlackRock headquarters building for $760 million and CBS’ Studio City lot for $1.85 billion in 2021.

Paramount, with its large collection of linear channels, has been subject to headwinds in the industry amid the march of cord-cutting as consumers look beyond pay TV packages to subscription streaming offerings. In the last quarter alone, more than 1.7 million subscribers were shed by the major pay TV and cable companies (including Comcast, Charter and DirecTV), per a tally from Leichtman Research.

During Paramount’s latest earnings call Aug. 7, CEO Bob Bakish was asked about the status of the potential sale and didn’t address BET by name, but replied: “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.”

Furthermore, the Post‘s article cites an allegedly close source to Paramount, who said that they notified bidders of the decision on Wednesday (August 16). “We made this decision because the benefits of maintaining a majority stake in BET Media Group creates more value for Paramount than any of the proposals we received,” the source reportedly told the publication. Another bidder in this debacle was a similarly legendary executive, Byron Allen, who also had a lot of public support.

Regardless, the report suggest that the source painted Paramount as a conglomerate that sought a sale “which could return the asset to Black ownership.” In addition, they apparently wanted a “party that could be a good partner and responsible steward of the assets and the mission.” Apparently, JPMorgan, Paramount’s sell-side bank, failed to provide financing to suitors upon the auction’s commencement, thus placing doubt in BET Group’s strength. Also, it didn’t predict BET’s earnings during the process, which caused further concern, and the source claimed that Allen offered $3 billion for it late in the game.