Please ensure Javascript is enabled for purposes of website accessibility

ViacomCBS Floating $3 Billion in New Common and Convertible Stock Following Launch of Paramount+ Streaming Service

By Eric Volkman - Mar 23, 2021 at 7:55AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Streaming networks and big-ticket sports broadcasting deals have to be financed somehow.

ViacomCBS (PARA 1.35%), fresh off the much-hyped launch of its Paramount+ video streaming service, is issuing $3 billion worth of common and convertible stock to bolster its finances.  

Most of this is a $2 billion issue of its Class B common stock; the remainder consists of mandatory convertible preferred stock. The latter converts to Class B common stock under terms that will be determined when the company prices these securities. The conversion will occur automatically on April 1, 2024, if it is not triggered prior to that date. The convertible preferred stock will be listed separately on the Nasdaq Stock Exchange under the ticker symbol VIACP.

A remote control unit pointed at a TV.

Image source: Getty Images.

ViacomCBS said it has granted the underwriters of the two issues separate 30-day options to buy up to $300 million more of Class B common stock, and as much as $150 million additional convertible preferred stock, with the latter only to cover overallotments.

The company wrote that it will utilize the net proceeds of both issues "for general corporate purposes, including investments in streaming."

It has already devoted considerable resources to its streaming product, including a Paramount+ ad spot during the 2021 Super Bowl -- by far the most expensive TV placement for advertisers.

Speaking of the Super Bowl, ViacomCBS' announcement of the securities issues comes less than a week after the company announced a splashy new multi-platform broadcasting agreement with the NFL. This 11-year deal extends ViacomCBS' existing deal with the league, allowing it to air all games played by American Football Conference teams live on its terrestrial CBS Television Network and Paramount+.

The deal also includes the broadcast rights for three Super Bowls, in 2024, 2028, and 2032.


Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Paramount Global Stock Quote
Paramount Global
$33.08 (1.35%) $0.44
Nasdaq, Inc. Stock Quote
Nasdaq, Inc.
$146.86 (0.50%) $0.73

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/23/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.