A special committee of Paramount Global’s board of directors reportedly agreed to recommend a $3 billion takeover bid from Skydance Media — possibly bringing to an end the months-long drama over the fate of the struggling entertainment giant.
Skydance — run by tech heir David Ellison, the son of billionaire Oracle co-founder Larry Ellison — has offered to acquire Shari Redstone’s National Amusements, Paramount’s parent company, for cash and then merge the Hollywood studio with his own shop, the Wall Street Journal reported Friday, citing people familiar with the matter.
Redstone has been weighing bids from several suitors and has not seen Skydance’s latest proposal, according to the Journal.
Skydance had offered the media heiress $2 billion for her 77% stake in National Amusements — which led to outcry from many of Paramount’s major investors that a merger would devalue their stock, as The Post previously reported.
Skydance, which is getting financial backing from RedBird Capital and KKR — reportedly sweetened its bid in recent days to appease Paramount’s voting and non-voting shareholders. It will now give $3 billion to that company’s other investors in the form of cash and debt repayment, Bloomberg reported.
A merger would give Skydance, which has partnered with Paramount to finance such hits as “Mission: Impossible – Dead Reckoning Part One” and “Top Gun: Maverick,” control over a treasure trove of movie classics including “The Godfather,” “Forrest Gump” and “Grease.”
Paramount’s notable media subsidiaries also include the CBS Television Network, Showtime, Nickelodeon, Comedy Central, MTV and Black Entertainment Television.
Paramount did not immediately respond to request for comment.
The ball is now in Redstone’s court.
The daughter of Sumner Redstone must decide whether to follow through on the merger with Skydance as was recommended by the board or sell her family’s holding company at a premium.
Redstone, who in the past has voiced support for a merger with Skydance, could also opt to sell her company to another buyer.
According to the Journal, Redstone has received an offer from Hollywood producer Steven Paul, who has reportedly been lining up financing to mount a $3 billion bid for National Amusements.
There is at least one other suitor who has signaled interest in acquiring the holding company, according to the Journal.
The decision is a difficult one for Redstone, who is keenly aware of her family’s decades-long stewardship of Paramount and is intent on protecting the Redstone legacy, sources familiar with the matter told The Journal.
Reports on takeover offers from Skydance and a consortium of Apollo Global Management and Sony Pictures, as well as a $30 billion bid from media entrepreneur Byron Allen, has left the stock see-sawing for months.
Paramount was down slightly after the board’s recommended approval of a deal, trading at around $11.
The age of cord-cutting and shrinking advertising dollars has had a negative impact on Paramount, which is saddled with $14.6 billion in long-term debt.
To make matters worse, the Paramount+ streaming service has struggled to turn a profit in a market that is hamstrung by fragmented audiences.
Last month, Bob Bakish resigned after Redstone’s long-time lieutenant clashed with her offer the deal with Skydance.
Paramount created a three-headed “Office of CEO” that includes CBS chief George Cheeks, MTV’s Chris McCarthy, and film studio head Brian Robbins.
The troika will lay out their strategy for the struggling company next Wednesday during a town hall with staff, according to an executive who spoke on condition of anonymity on Friday.
The all-hands meeting will follow Paramount’s annual shareholder meeting on Tuesday.
