By Dhirendra Tripathi
Investing.com – Shares of ViacomCBS (NASDAQ:VIAC) rose more than 3% in Tuesday’s trade on hopes that the unwinding in the shares of the Archegos-linked companies may be over.
The company’s aggressive push in Latin America with purchase of a broadcaster in Chile added to the positive mood for Viacom shares, which have mostly been at the receiving end of traders’ wrath.
ViacomCBS will buy Chilevision from AT&T- (NYSE:T) owned WarnerMedia as the media giant looks to boost its streaming audience in Latin America.
Chilevision attracted nearly a quarter of Chile’s total television viewership in 2020, according to ViacomCBS.
ViacomCBS has been in the news for all the wrong reasons lately. In a March 24 filing, the company said it would raise almost $3 billion in the sale of new equity. That send the shares tumbling as traders feared dilution.
Now Archegos, a family office of former hedge fund manager Sung Kook ‘Bill’ Hwang, was heavily exposed to Viacom and stocks of other media companies including Discovery (NASDAQ:DISCA). As the stocks slid, there were margin calls and when Hwang could not meet the demand of his brokers like Credit Suisse (NYSE:CS) and Nomura (NYSE:NMR), they resorted to selling shares.
That fiasco has resulted in a $4.7 billion hit for Credit Suisse and a $2 billion damage for Nomura. Final numbers haven’t been prepared yet or at least not disclosed.
ViacomCBS shares have more than halved since trading at a record of $101.97 in March.
Viacom Gains On Hope Archegos-Linked Unwinding Is Over, Chile Deal
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