Viacom is reported to have dropped out of talks to buy Scripps Networks Interactive. Industry trade magazine Variety, for example, is reporting that the decision – although not confirmed by any of the parties – leaves the road clear for Discovery Communications to pursue a deal with Scripps.
The current picture is that Discovery and Scripps are in talks, but they may not result in an agreement.
Viacom’s all-cash bid could have resulted in a severe stress to its share price and could have ended up with Viacom being downgraded to ‘junk bond’ status.
Scripps Networks is very much a family-controlled business, and a report July 26 from analysts at Wells Fargo Bank suggested that the family trusts would be seeking at least $91 a share, and perhaps as much as $95 for a sale.