Viacom says it will divest its stake in Blockbuster Video by midyear. The company currently owns 81% of the Dallas-based rental chain. Viacom plans to offer shareholders an option to swap Viacom stock

Viacom says it will divest its stake in Blockbuster Video by midyear. The company currently owns 81% of the Dallas-based rental chain. Viacom plans to offer shareholders an option to swap Viacom stock for shares of Blockbuster. The ratio has not yet been determined.

Blockbuster experienced a net loss of $983.9 million in 2003, including a $1.3 billion charge during the fourth quarter for impairment of goodwill and other assets. Total revenues for 2003 were $5.91 billion, vs. $5.57 billion in 2002.

Not including the $1.3 billion charge, total fourth-quarter revenues increased to $1.62 billion from $1.58 billion in 2002. Total revenues of 2003 prior to the charge were $5.91 billion, vs. $5.57 billion.

For the full year, Viacom's revenues increased 8% to $26.6 billion. Operating income was $3.6 billion, vs. $4.6 billion in 2002.

The cable networks division, which includes MTV, VH1 and others, saw revenues rise 19% to $5.6 billion, and operating income rise 23% to $2.2 billion. At the radio division, revenues fell 1% to $2.1 billion, and operating income dropped 3% to $975 million.

Viacom stock closed today (Feb. 10) up 96 cents at $41.35.