2023-07-14 16:29:28 ET
National Amusements -- the Redstone family holding company and parent of Paramount Global ( NASDAQ: PARA ) ( NASDAQ: PARAA ) -- is reportedly talking with creditors to renegotiate some debt after an annual-report disclosure raised going-concern risks.
The company's legacy movie-theater business has been the subject of pandemic-related notes in the report about lower cash flows creating uncertainty over its ability to continue as a going concern.
That's led to creditors now jumping on the language to trigger talks with the company over paying down part of a $250M debt sooner, and accepting a higher interest rate, the WSJ reported .
Still, NAI is not expected to give up any voting stock in Paramount ( PARA ) ( PARAA ) to resolve the matter, according to the report. NAI owns almost 80% of Paramount's voting stock.
And it's possible -- but unlikely -- that the remedies are insufficient, and lenders declare an involuntary bankruptcy of the NAI unit, which would see them taking a chunk of voting stock and several theater properties. But National Amusements would still maintain control with more than 60% of Paramount voting stock in that case, the report said.
Paramount stock ( PARA ) was down 1.3% after hours following the report; it closed down 5.1% on Friday.
For further details see:
Paramount parent reportedly in talks to rearrange debt on risk disclosure