Viacom told Scripps Networks Interactive it is willing to pay all cash to acquire the U.S. TV network operator, according to sources. Fred Katayama reports.
Viacom told Scripps Networks it's willing to pay cash to buy it, sources told Reuters. It's going for Scripps' large female audience and content, including HGTV, Food Network, and Travel Channel. That programming could help Viacom put together a new cable bundle for less than $20 per month. It's not clear what the bid is valued at, but a deal could cost Viacom its investment-grade status. The company's debt is already at the lowest level of investment grade after a Moody's downgrade last year. Viacom's stock fell on the news. Scripps Networks was up. Reuters correspondent Jessica Toonkel says the all cash offer is an aggressive move that surprised Wall Street. (SOUNDBITE) JESSICA TOONKEL, REUTERS CORRESPONDENT, (ENGLISH) SAYING: "Bond holders are likely not gonna be very happy about this. So, but, I think, what Viacom is saying we need to do something big. We need to be aggressive. We're in a turnaround strategy right now. So, this deal is gonna help us turn around, and, in the long-run, cost, synergies, and such." Viacom is competing against Discovery Communications in bidding for Scripps. But Discovery is not expected to make an all-cash offer. Sources say Scripps will make its choice within the next few days.