Yahoo Finance Paramount Board OK’s Merger Deal With Skydance After False Start: Report
A special committee of Paramount Global’s directors has approved a plan to merge with David Ellison’s Skydance Media after months of scattershot negotiations, clearing the way for a deal that will undoubtedly transform the entertainment industry, a person with knowledge of the matter told Bloomberg News.
The insider said that the deal is expected to be inked on Sunday, with an official announcement coming as soon as Monday. It would see Skydance acquire National Amusements, the holding company that holds a controlling stake—77 percent of voting shares—in Paramount.
Skydance, the production company responsible for franchises like Mission: Impossible, Star Trek, and Top Gun, has been trying to acquire Paramount, the parent company of CBS, MTV, Nickelodeon, and Comedy Central, for more than six months.
Paramount Announces CEO Bob Bakish’s Exit as Merger Looms
The two companies entered exclusive negotiations in April, with Paramount ousting its longtime CEO Bob Bakish as a potential deal loomed. In his place, the company installed a three-headed hydra known as the “Office of the CEO,” made up of George Cheeks, the CBS CEO; Chris McCarthy, the CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, the CEO of Paramount Pictures and Nickelodeon.
The exclusivity window lapsed the next month, with the fitful talks stalling out as a bidding group representing Sony and a private-equity firm began sniffing around. It was later reported that Shari Redstone, the scion who heads up National Amusements, had personally killed the talks.
Three weeks later, however, Skydance was back at the negotiating table, and terms were quickly set for a preliminary deal. People familiar with the rekindled talks said at the time that the $1.75-billion agreement included a 45-day “go-shop period” allowing Paramount to hunt for a better offer.
Paramount, a flagging but still legendary presence in the media industry, has struggled to adapt to the streaming era, with despairing shareholders watching as the giant’s market value has plunged by more than half since 2019.
Still, some shareholders reportedly worried that the earlier Skydance deal favored Redstone and her family too heavily, a concern that became a sticking point in negotiations. Reuters reported that Redstone, who initially favored the deal, staked it through the heart after Skydance adjusted its offer to benefit other non-family shareholders.
Under the terms of the new deal proposed earlier this week, National Amusements will not require the merger be approved by a majority of those other shareholders, according to The Wall Street Journal.
Shares of Paramount rose more than 6 percent in after-hours trading after the deal was reported.
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