At the annual industry conference known as CinemaCon, movie studios try to wow theater owners with A-list movie stars, chats with famous directors and sizzling trailers for big-budget film projects.
But Paramount Pictures' presentation underwhelmed. Monday night's event at Caesars Palace included an awkward exchange between Megan Fox and Will Arnett, stars of the sequel to "Teenage Mutant Ninja Turtles." Audience members griped that the studio did not screen footage from its upcoming movie "Star Trek Beyond." And acclaimed director J.J. Abrams ruffled feathers when he suggested to a crowd of cinema owners that they needed to adapt to changing consumer habits.
The tepid response was the latest misstep for the historic Melrose Avenue movie studio, which is struggling to reverse a prolonged slump at the box office. Paramount had two high-profile disappointments in the last quarter, "Zoolander 2" and "Whiskey Tango Foxtrot," that analysts say could result in a $100-million write-down.
Paramount also faces an uncertain future. Viacom Inc. Chief Executive Philippe Dauman in February said the company would consider selling a minority stake in Paramount. Viacom needs money to pay down debt, and Dauman is hoping to appease restive investors after Viacom shares plummeted more than 50% in the last two years. Fetching a big sum for a piece of Paramount could boost the overall value of Viacom.
Analysts have estimated that Paramount is worth at least $5 billion, or as much as $10 billion. They noted that China's Dalian Wanda Group paid $3.5 billion to purchase a much smaller Hollywood production company, Legendary Entertainment.
The Paramount stake sale marks the first time in more than a decade that a major Hollywood studio has gone on the market. The auction has drawn interest from more than three dozen entities, according to Viacom.
The company has declined to identify prospective bidders, and the sales process is in the early stages. The investment banker hired by Viacom, PJT Partners, has narrowed the field to a handful of the most attractive suitors, according to a person close to the process who was not authorized to discuss the matter. Formal bids are expected to be submitted next month. Dauman set an ambitious deadline of June 30 to complete the sale.
Complicating the sale process, however, has been the turmoil surrounding the company's founder, the ailing 92-year-old mogul Sumner Redstone. Viacom's controlling shareholder is fighting a lawsuit brought by a former girlfriend who has challenged whether Redstone is mentally competent.
Less than a week after Dauman announced the Paramount sale, Redstone told Paramount Chairman Brad Grey that he did not want to sell the movie studio, another person said. Redstone won a hard-fought battle for control of the legendary studio in 1994, agreeing to pay $10billion for it.
"Sumner loves Paramount for a lot of reasons," Mario Gabelli, a prominent Viacom voting shareholder, said this week. "But there is a question mark about what is really going on there."
Another drawback for potential suitors is that Viacom is offering only a minority stake in the studio. Some executives said they might have been interested, but the minority interest made the prospect a non-starter. It is unusual for a company to sell a piece of a significant asset.
Even so, Paramount is drawing plenty of interest among potential suitors, people close to the process say.
"Many people are interested," said Marc Ganis, co-founder and managing director of Jiaflix Enterprises, which helps studios distribute movies in China. "The question that remains is whether anyone will offer a deal that will be acceptable to Philippe [Dauman] and Viacom."
There could be considerable upside to owning a stake if Paramount could reverse its fortunes.
The studio has struggled in recent years, suffering from a thin film slate. Viacom's corporate strategy, implemented by Grey, has been to make fewer movies than in years past, choosing instead to focus on profitability. But that strategy has made it difficult to compete in an industry where the box-office is increasingly concentrated among a handful of films.
"They were focused on profitability instead of market share for a while," Ganis said.
The studio has pledged to increase its film output, and expects to release 15 films this year.
Paramount has notched deals with producers such as Jerry Bruckheimer and Leonardo DiCaprio's production company Appian Way. The studio also has been ramping up TV production since launching that unit in 2013.
Prospective bidders have included Rupert Murdoch's 21st Century Fox, which offered to buy the entire studio, but Viacom executives said they were not interested, two people familiar with the overture said.
Speculation has mainly centered around a handful of Chinese players that have shown an interest in Hollywood, including Tencent, Dalian Wanda Group and Alibaba Group, the Chinese e-commerce giant run by billionaire Jack Ma.
Alibaba Pictures last year invested in and helped promote Paramount's summer release "Mission: Impossible — Rogue Nation." That deal came after Ma met with executives from several studios, including Paramount, in the fall of 2014 to discuss possible partnerships.
Dalian Wanda, led by China's richest man, Wang Jianlin, may be the most likely candidate, said several people familiar with the matter. The real estate and media giant has proved to be an aggressive buyer, given its recent acquisition of Legendary. It also owns AMC Entertainment, which recently signed a deal to buy Carmike Cinemas, the nation's fourth-largest chain.
Representatives of Alibaba, Dalian Wanda and Tencent did not respond to requests for comment.
Staff Writer Amy Kaufman contributed to this report.