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Doesn't via begin to look a lot more expensive once you back out BBI's contribution to FCF. I'm suprised they're going to go ahead with this transaction.

But you're going to get BBI anyway as a spin-off, so your "value" won't change, it will just come in two pieces.

Blockbuster is declining, and is threatened by electronic delivery (VOD, internet) and other challenges (NetFlix, Wal-Mart), and Viacom doesn't want to hold it (is my guess.) Maybe you don't either, so you'll get your chance when it comes to you as a separate issue.

BTW, from BusinessWeek:

S&P Says Buy Viacom

Before a $1.3 billion FAS 42 charge, Viacom posted fourth-quarter earnings per share of 36 cents, vs. 37 cents, in line with S&P's and Street estimates. Revenues grew 11% and pro forma EBITDA 7%, driven mainly by cable networks ad/affiliate and filmed entertainment revenues, and partly offset by declines at the TV station group, Infinity Radio, and Blockbuster. After a 1.3 billion fourth-quarter goodwill write-off, Viacom's board approved a plan for a tax-free Blockbuster split-off. Viacome reiterated the 2004 outlook of a 5% to 7% increase in revenues and 13% to 15% earnings per share growth.
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