Paramount Global shares got a boost last week after reports of a possible takeover bid, but the media company could still prove a rare losing bet for Berkshire Hathaway, its largest institutional investor. The media company’s Class B shares rose nearly 5% last week to close Friday at $14.43, as investors cheered billionaire media mogul Byron Allen’s $14.3 billion takeover offer. Allen Media Group offered $21.53 for each Paramount Class B non-voting share, about 50% above the 90-day average price. But even that is still well below the price Berkshire paid to acquire its non-voting stake in the first quarter of 2022, when Class B shares were trading as high as $38.50 and as high as $27.90. The Omaha-based conglomerate owns 93.7 million non-voting Class B shares of Paramount, or a 15.4% stake, according to FactSet. PARA 5Y mountain Paramount As recently as last spring, Buffett expressed pessimism about the streaming industry, leading many to speculate that it was one of his investment managers who bought Paramount. It’s possible that Berkshire was betting on Paramount to be an acquisition target. The “Oracle of Omaha” believes the industry has too many players chasing viewers’ dollars, leading to a harsh price war. Meanwhile, there are a finite number of subscribers that all streamers compete for, while shows and movies remain expensive to acquire or produce. “You need higher prices, or it won’t work,” Buffett said at Berkshire’s 2023 annual meeting. “There are a lot of companies that don’t want to give up. And who knows what effect prices will have because of that. But anyone who tells you they know what effect prices will have in the future is kidding themselves.” Paramount has struggled in recent years, suffering from declining revenue as more consumers abandon traditional pay TV, continued streaming losses and rising interest rates. The stock had posted seven straight years of losses and is back in the red in 2024. Shari Redstone, who controls Paramount through her company National Amusements, has been open to making deals in recent months in an effort to merge or sell the company. There are brands such as CBS, Showtime, Nickelodeon and the film studio of the same name. There have been reports of discussions for a sale to Skydance Media and Warner Bros. Discovery. Many are skeptical that Allen’s deal will come to fruition. “After so many second-place finishes, we would have thought the market would have ignored this news as a non-event, even if it theoretically values PARA as a mid-20s,” Don Bilson, head of event-based research. to Gordon Haskett, he said in a note. Allen has a long history of making bids on major media assets, but few of his deals have resulted in sales.