Media giant ViacomCBS (NASDAQ:VIAC) (NASDAQ:VIAC.A) is looking for "strategic alternatives" for publishing house Simon & Schuster. Viacom CEO Bob Bakish says he doesn't see Simon & Schuster as a "core asset of the company," opening the door to a spinoff or sale of the entire unit.
This isn't a 'core asset'
Bakish shared this information in a conference presentation on Wednesday:
We've been conducting a portfolio review of our company. Coming out of that, we've made the determination that Simon and Schuster is not a core asset of the company. It is not video-based, it doesn't have significant connectivity to our broader business. At the same time, there's no question that it's a marquee asset. It's highly valuable.
ViacomCBS is rebuilding its balance sheet after the $12 billion merger between Viacom and CBS, which doubled Viacom's long-term debt balance to $18 billion. Selling Simon & Schuster would let the company pay down its towering debts a little bit faster.
The CEO also said that ViacomCBS had already fielded several unsolicited calls from potential buyers of the publishing business. Viacom's publishing unit contributed $814 million to Viacom's top line in 2019, 1.3% below the year-ago total.