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Published: Sun, July 17, 2016
Economy | By Melissa Porter

Baidu Considered Bid for Paramount Studio Stake

Baidu Considered Bid for Paramount Studio Stake

Chinese companies are increasingly staking their claim on Hollywood, with Dalian Wanda Group Co. closer to its goal of becoming one of the world's dominant entertainment companies following reports it is in talks to buy a minority stake in the Paramount Pictures movie studio.

Viacom's plan to sell a stake in Paramount Pictures could have a "severe negative impact" on the company, controlling shareholder Sumner Redstone's National Amusements said Friday. Wanda, which bought production company Legendary Entertainment in January, has been trying to expand its US movie business.

National Amusements Inc, through which the 93-year-old media mogul owns 80 percent of Viacom, said in a statement that Paramount was "one of Viacom's most valuable assets" and a stake sale "would chill the interest of parties that may be interested in a larger transaction involving all of Viacom".

Representatives for Baidu, Wanda and Viacom declined to comment.

Earlier this year, Wanda invested in Paramount's "Teenage Mutant Ninja Turtles" sequel.

Wanda, founded by Chinese billionaire Wang Jianlin, bought U.S. movie theatre chain AMC in 2012 for US$2.6 billion and AMC just days ago announced it was buying London- based Odeon & UCI cinema group in a deal worth about US$1.2 billion.

"It is beyond understanding that "National Amusements" would continue in its attempts to interfere with a potential transaction that would create a unique opportunity to drive long term value for both Paramount and Viacom, without even waiting for the facts".

"It's unclear the extent to which these initiatives have been fully discussed with Shari Redstone's camp, but sources there confirmed that settlement talks have been initiated", The Post notes.

Sumner Redstone's recent move of adding a prominent Los Angeles litigator, Michael Tu, who specialises in securities law, to his legal team is being seen as the start of a campaign to dump Viacom chairman and Dauman and other members of the board.

National Amusements controls nearly 80 percent of the voting stock at Viacom and has a similar stake in CBS Corp. "Courts in DE and MA have yet to decide whether to hear questions of Sumner Redstone's competency".

"National Amusements has one goal for Viacom, which is to create long-term value for all of Viacom's shareholders", the Norwood, Mass., company said in an emailed statement.

Viacom's Class B shares fell 1.2 percent to $44.25 at 2:10 p.m.in NY.

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