Redstone, National Amusements Reach Debt Deal
Could Involve Selling Some Theaters
Mike Farrell -- Multichannel News, 2/27/2009 5:14:04 PM
National Amusements, the theater chain controlled by Viacom and CBS chairman Sumner Redstone, has reached a deal with its lenders, assuring at least for the near future that the media mogul won't have to reduce his stakes in the two media giants.
According to statement by the theater chain, the deal would extend the maturities on NAI's existing debt - about $1.5 billion from $1.6 billion after a repayment at closing - to Dec. 31, 2010 and would be secured by "substantially all of National Amusement's assets." Other repayments would be made later this year and in 2010, the company added."National Amusements would be permitted to satisfy the indebtedness with cash flow from its operations and through tax refunds and the sale of assets as determined by National Amusements," the company continued in its statement.
In December, Redstone sold his controlling interest in videogame maker Midway Games for about $100,000 in cash, a fraction of what he originally paid for it.
Redstone has hinted for months that negotiations with lenders were moving forward and were going smoothly. And he has vowed that he would not sell any additional shares of Viacom or CBS.
It is likely that NAI will sell some of its theaters to satisfy its obligations - Redstone had said in the past that one of the company's best assets is its real estate.
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