Shares of ViacomCBS (VIACA) - Get Report fell on Thursday, even as National Amusements Inc., the media titan's controlling shareholder, said it had forged an agreement with Wells Fargo to restructure its credit facility.
“Following this amendment, NAI will have a revolving facility of $125 million and ample liquidity, in addition to its substantial cash reserves, to fund operations of NAIEH [NAI Entertainment Holdings], which includes its theater business,” National Amusements said in a statement.
“NAI will not sell stock in ViacomCBS and does not intend to pledge additional stock of ViacomCBS, which remains at existing levels.”
National Amusements is the closely held Dedham, Mass., movie-theater operator.
NAI needed to do the restructuring because the value of the ViacomCBS shares it pledged as collateral for its debt dropped below Wells Fargo’s minimum threshold, people familiar with the matter told the Journal.
ViacomCBS’s stock has plunged 69% in the 12 months through Thursday. Shares finished Thursday down 5.1% at $13.00.
Meanwhile the freeze in merger-and-acquisition activity that has accompanied the coronavirus is hitting ViacomCBS and fellow media giant AT&T (T) - Get Report hard. The two have recently sought to unload assets.
In early March, ViacomCBS Chief Executive Bob Bakish said the company was set to begin the sales process for its Simon & Schuster publishing division. ViacomCBS thought it could get $1.2 billion, Bloomberg reported.
But that’s up in the air now. Book publishing isn’t at the top of most people’s minds during a pandemic.
As for AT&T, it’s trying to divest its regional sports networks, which include ones broadcasting the professional baseball, basketball and hockey teams. The company wanted close to $1 billion for the stations, Bloomberg reports.
But professional sports are now hibernating due to the virus outbreak.
AT&T shares rose $2.20, or 7.8%, to end at $30.60.
Editor's note: This report has been corrected to accurately reflect the restructured financial instrument.