A team led by a former top Viacom executive has quietly approached the media giant about buying its Paramount Parks unit, The Post has learned.
Tom McGrath, who stepped down as head of Viacom Inc.’s Paramount Enterprises last summer, has lined up investment firms Spectrum Equity Partners and GS Capital Partners, Goldman Sachs’ private equity arm, to back him in his efforts to acquire the theme parks business, sources familiar with the situation said.
As president of Paramount Enterprises and executive vice president of Viacom Entertainment Group, McGrath oversaw Viacom’s theme-parks, movie theater and music publishing businesses. The group expressed its interest to Viacom earlier this year in an attempt to preempt an auction of Paramount Parks, which is expected within the next
few months.
Sources say the division – which has amusement parks in North Carolina, Ohio, California and Virginia as well as Canada – could fetch $900 million to $1 billion. Viacom has told bankers that in the next few weeks it plans to begin formally interviewing Wall Street firms to advise on the sale of the unit.
However, one source close to the process said the firm is expected to retain Citigroup to handle the process.
However, yesterday, Viacom co-president Tom Freston said in an earnings conference call that the company is in the “early stages of looking at potential opportunities” for Paramount Parks, which is viewed as a noncore asset.
A Viacom spokesman would not comment further. McGrath did not return a call seeking comment.
Besides the McGrath-led team, other potential buyers for the division include amusemart park operators Cedar Fair, L.P. and Universal Parks, which is partly owned by NBC Universal and Blackstone Group, as well as other private equity firms.
Six Flags and Busch Entertainment Corp., a subsidiary of brewer Anheuser-Busch are also viewed as possible, but less likely, buyers.
Viacom is putting its theme parks business on the block in what would be the latest in a string of asset sales at the media empire as it re-evaluates its strategy.
As The Post reported in October, Viacom is screening its options for its Famous Players Canadian movie theater chain.
The company is in the early stages of an auction, which has already attracted the interest of more than a dozen bidders, sources say.
Executives familiar with Viacom’s financials initially estimated the chain could garner as much as $400 million to $500 million.