Can Sony, Apollo sell CBS if they do acquire Paramount?

Paramount (PARA, PARAA) is in deal talks with Sony (SONY) and Apollo Global (APO), but should the potential suitors acquire the media giant, they have plans to break it up and sell off the CBS network. To shed light on this development, Bank of America Securities Senior US Media and Entertainment Analyst Jessica Reif Ehrlich joins Catalysts.

Ehrlich notes that Sony "can't own" CBS due to foreign ownership rules. However, Ehrlich highlights that if the transaction were to proceed, two questions would arise: Who can afford to own CBS and who can even own CBS "from a legal perspective"?

Note: Apollo Global Management is a majority owner of Yahoo, Yahoo Finance's parent company.

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This post was written by Angel Smith

Video transcript

Well, speaking of another broadcasting network, CBS, according to the New York Times, Sony and Apollo's plan for Paramount would involve a little bit of a break up selling off CBS.I'm curious from your perspective, who would a potential buyer be for CBS?Look, uh the, what's happened in the last few years.Um You know, but in traditional media, there's been a slow decline in, in, well, in the broadcast viewership, of course, I mean, I've also moved from linear to streaming, um unquestionably having said that broadcasters are really powerful.There's, there are four broadcast uh networks in the country and they have tremendous reach.So I think it would be a very attractive property.The question is who can afford it and who could own it from a legal perspective.The reason why this is being discussed as something for sale is that Sony can't own it.We have foreign ownership rules, they can only only own a small piece of it.Um So they would have to sell it.So we'll see, we'll see if Sony um and Apollo are successful in the end or if Sky Dances or if nothing happens