New York, Feb 03: Viacom is expected to decide within two weeks to spin off its Blockbuster video-rental chain, as it has so far failed to reach a deal with a buyer, The New York Times said on Monday, citing executives close to the talks.

A spin-off, the form of which has not been determined, is the most likely outcome without a buyer, the paper said. Analysts expect it to involve an exchange of stock between shareholders of Viacom and shareholders of the 18 per cent of Blockbuster already owned by the public, it said.
Sources said last month that Viacom was in talks to sell its controlling stake in Blockbuster to a group of private equity firms including Blackstone Group, Thomas H Lee, Providence Equity Capital and the Quadrangle Group.
But after haggling over price, the talks collapsed, the Times said, citing executives. The executives said that the talks could resume, if Viacom were willing to lower its price, according to the paper. Based on the current price of Blockbuster shares, with no premium, Viacom’s stake could be expected to fetch USD 2.8 billion, it said.
Bureau Report