CBS Corporation (CBS - Analyst Report) stated that an affiliate of Platinum Equity has made an offer to buy assets of its CBS Outdoor International business for about $225 million.
Earlier this year, the company decided to convert its CBS Outdoor operations in North America and South America into a real estate investment trust (“REIT”) and divest its Outdoor businesses in Europe and Asia.
CBS Outdoor International is counted among the pioneers in advertisement on billboards and other surfaces. It operates in the United Kingdom, France, Italy, Ireland, China, Netherlands and Spain.
The move is a strategic fit for CBS as it is focused on lowering its dependency on advertising and is laying more emphasis on increasing subscription based revenue channels.
The company further strengthened its ties with Netflix, Inc. (NFLX - Analyst Report) by extending its multiyear streaming video deal for select library content. Moreover, it entered into a deal with Amazon.com Inc. (AMZN - Analyst Report). These measures facilitate CBS in monetizing its content.
Alongside, CBS Corporation acquired the remaining 50% stake in TV Guide Digital, including the TVGuide.com and TV Guide Mobile properties from Lions Gate Entertainment Corp. (LGF - Analyst Report). The addition of TVGuide.com to CBS’ impressive portfolio is believed to be a major boost for the company’s digital business as both TVGuide.com and TV Guide Mobile enjoy a strong audience in the lucrative TV information category.
We expect the company to benefit from reverse compensation from affiliates, strong demand of its content, digital distribution, syndication sales and retransmission consent.
CBS currently holds a Zacks Rank #3 (Hold).