Reports: Tyler Perry, Byron Allen Want Interest In BET Media

Byron Allen, Tyler Perry

Paramount is in talks with Tyler Perry to sell a majority interest in BET Media Group, which owns Black Entertainment Television (BET) and VH1. Tyler Perry has close relations with BET which licenses a lot of his movies. He already owns a stake in the channel’s online platform, BET Plus.

However, shortly after the rumors hit the wires on Monday, Byron Allen’s spokesperson issued a statement saying “Byron Allen is interested in buying BET, and he will be pursuing the acquisition of the network.” Thus, there is possibly going to be a bidding war just over the horizon.

There have been very few cable network deals over the last several years as cord cutting and cord shaving has turned this industry from a huge growth engine into a declining business. More and more consumers continue to get their video from the myriad streaming services, making linear TV programing on cable and satellite become increasingly obsolete. 

With cable and satellite operators continuing to jack up prices and add on mysterious surcharges like a sports surcharge and a broadcast surcharge, this trend of consumers fleeing to cheaper streaming services is likely to continue.

BET was valued at $2.7 billion when it was acquired by Viacom in 2000 (Now rebranded as Paramount), a hefty $38/sub and more than 21x cash flow. However, it is unlikely to fetch anywhere near that in this environment.

In the 2000’s, cable networks typically changed hands in the range of 14-20x cash flow, or Earnings Before Interest, Depreciation, Taxes and Amortization (EBITDA). Up until 2017, they continued to trade in the low to middle double digits. Since then, double digit deals have been rare (a notable exception being Walt Disney Company’s $36 billion acquisition of the 21st Century Fox cable networks at more than 15x cash flow in 2019).