Shares of Paramount Global (NASDAQ: PARA) (NASDAQ: PARAA) were on an upswing in pre-market trading at the time of publishing on Friday after National Amusements — the controlling shareholder of Paramount Global attracted a strategic preferred equity investment of $125 million from merchant bank investor BDT Capital Partners, an affiliate of BDT & MSD Partners.
This investment is expected to strengthen NAI’s balance sheet as it will enable the company to reduce its interest expense and pay down its revolving loan and recent term loan borrowings. “Upon termination of those facilities, NAI shares of Paramount Global which had been pledged to support those loans will be released back to NAI, and obligations to make future pledges under these facilities will be eliminated.”
The investment is expected to close next week. Paramount had a dismal Q1 and slashed its dividend.
Analysts, however, remain bearish about PARA stock with a Moderate Sell consensus rating based on four Buys, three Holds, and eight Sells.