ViacomCBS to raise $3B in stock offerings to bolster streaming
ViacomCBS has disclosed plans to raise $3 billion in stock offerings to invest in streaming content.
The mass media conglomerate announced that the new $3 billion stock offerings consist of two concurrent offerings of $2 billion worth of its Class B common stock and $1 billion of its Series A Mandatory Convertible Preferred Stock.
According to ViacomCBS, Morgan Stanley and J.P. Morgan are the book runners on the offering, and have 30-day options to purchase up to an additional $300 million of Class B common stock and up to an additional $150 million of Mandatory Convertible Preferred Stock.
In a published statement the company explained that the net proceeds from the stock sale will be invested in its streaming services and other general corporate purposes.
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.
Earlier this month ViacomCBS relaunched its CBS All Access streaming service as Paramount+ with a slew of reboots, spinoffs and original series and films in the process. At an investor day in February, the company said it expects to ramp up its streaming content spend to $5 billion by 2024.
With Disney+ already topping 100 million subscribers, and HBO Max set to launch its own ad-supported offering in June, Paramount+ is looking to supercharge its existing subscriber base (more than 19 million between CBS All Access and Showtime) while also boosting Pluto, its free, ad-supported streaming offering.
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