Paramount Communications Incorporated
| Conglomerate | |
| Industry | Entertainment, industry, mass media |
| Fate | Sold to Viacom |
| Predecessor | Gulf+Western |
| Successor | Viacom (controlled by National Amusements) |
| Founded | 1989 |
| Defunct | 1994 |
| Headquarters | New York, New York, United States |
|
Key people
|
Charles Bluhdorn, Martin S. Davis |
| Subsidiaries |
Madison Square Garden Paramount Parks Paramount Pictures Paramount Television Simon & Schuster |
Paramount Communications, Inc. was an American media conglomerate company from 1989 to 1994.
In 1983 Gulf and Western Industries began a restructuring process that would transform the corporation from a bloated conglomerate consisting of subsidiaries from unrelated industries to a more focused entertainment and publishing company. The idea was to aid financial markets in measuring the company's success, which, in turn, would help place better value on its shares.
Though its Paramount division did very well in recent years, Gulf and Western's success as a whole was translating poorly with investors. This process eventually led Davis to divest many of the company's subsidiaries. Its sugar plantations in Florida and the Dominican Republic were sold in 1985, and the consumer and industrial products branch was sold off the same year. In 1989, Davis renamed the company Paramount Communications Incorporated after its primary asset, Paramount Pictures.
In addition to the Paramount film, television, home video, and music publishing divisions, the company continued to own the Madison Square Garden properties (which also included MSG Network), a 50% stake in USA Networks (the other 50% was owned by MCA/Universal Studios) and Simon & Schuster, Prentice Hall, Pocket Books, Allyn & Bacon, Cineamerica (a joint venture with Warner Communications), and Canadian cinema chain Famous Players Theatres.
Also in 1985 the company launched a $12.2 billion hostile bid to acquire Time Inc. in an attempt to end a stock-swap merger deal between Time and Warner Communications, which also renamed itself after the Warner Bros. movie studio it owned, upon selling off its non-entertainment assets. (The original name of Warner Communications was Kinney National Company.) This caused Time to raise its bid for Warner to $14.9 Billion in cash and stock. Gulf and Western responded by filing a lawsuit in a Delaware court to block the Time-Warner merger. The court ruled twice in favor of Time, forcing Gulf and Western to drop both the Time acquisition and the lawsuit, and allowing the formation of Time Warner.
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