Rates were low, the cost of servicing $14 billion in debt was $0.
CEO's had the company take the debt on, paid themselves fat bonuses and hoped that the little people downstairs would invent something new that would save the company.
You think Shari Redstone, who has 77.4% of the voting power in Paramount, just let her employees get rich at her expense? She hired them, she offered the compensation.
She paid the CEO $30 million a year to lose $30 billion in market cap (of which National Amusements share is $23 billion) in just 4 short years, so I would say that they got pretty rich at her expense.
Obviously, but your comment implied malfeasance on the part of the CEOs (“paid themselves fat bonuses”), whereas my comment illuminates you to the fact that the CEOs action’s and compensation were subject to a single owner’s approval.
That is about as market price as it gets. Also, if you dig into the proxy forms, I bet you would find those CEOs probably got paid in Paramount stock with various lockup terms before they could sell, so they probably didn’t make out as well as you think.
Yeah. Episodic streaming content has been incredible for the past few years, but now TV studio execs realized that indiscriminately pumping money into everything, all the time, inexplicably, isn't a good business move! So they've just started firing the big staffs they've picked up and cancelling projects. Because, when you realize you've been making irrational moves, the answer isn't trying to make rational moves– it's making equally irrational moves in the opposite direction.
The CBS Viacom merger was a cynical plan from the very beginning. It even drew shareholder lawsuits which they ultimately had to settle. The writing was on the wall as early as 2015, though, when the company started restructuring several core businesses in moves that I saw at the time as "thinly veiled cash grabs."
During a time when they could have been making deeper investments in these business and capturing large parts of a growing media market they completely ceded the space and any expertise they had in it all to pad their own paper value. Immediately after the merger they lost a lot of licensing revenue because they drastically overestimated the value of the corporate assets they cherry picked for themselves.
CEO's had the company take the debt on, paid themselves fat bonuses and hoped that the little people downstairs would invent something new that would save the company.