Warren Buffett’s investment company Berkshire Hathaway held its annual shareholder meeting at the weekend, and there the investor legend himself could reveal that he has completely sold out of Paramount at a loss.
– I was 100 percent responsible for the Paramount decision. It was 100 percent my decision. Now we have sold everything, and we lost quite a lot of money, he said according to CNBC.
60-70 percent drop
Documents submitted to the US Securities and Exchange Commission (SEC) show that Berkshire owned 63.3 million shares in Paramount at the end of 2023. At that time, the stock was at $14.80, which valued the Paramount stake at about $937 million. The post had then been reduced by around a third during the fourth quarter of last year.
According to the channel, the investment company bought its first (B) shares in Paramount in the first quarter of 2022, when the share fluctuated between 30 and 40 dollars. Since then, turnover failure, dividend cuts and CEO exit have contributed to sending the share down 44 per cent in 2022 and a further 12 per cent in 2023.
So far in 2024, the flight of consumers from traditional pay TV and the streaming service’s inability to make money has caused the stock to sink another 12 percent. In Monday’s pre-trade on Wall Street, however, Paramount is up more than 4 percent to $13.47.
Acquisition interest
Last week it was announced that Sony Pictures and Apollo Global Management have made a cash offer of $26 billion for Paramount. This was the second bid from Apollo, and Paramount has previously also been in acquisition talks with David Ellison’s Skydance Media.
Furthermore, Paramount has sold the publishing house Simon & Schuster to another private equity giant: KKR.
According to CNBC, Buffett said on Saturday that the Paramount fad has made him think more carefully about what people prioritize in their free time. He has previously said that the streaming market has too many players, which results in an intense price war.
