Los Angeles, CA – After months of negotiations, Paramount Global and prominent shareholder Shari Redstone may be navigating a different path on their own, insiders report. Speculations suggest that the current offers on the table from Skydance Media-RedBird Capital Partners and Sony Pictures Entertainment-Apollo Global Management are unlikely to materialize, leading Redstone to accept that a deal with David Ellison’s Skydance is off the table.
As of Friday morning, the special committee formed by Paramount Global’s board to assess merger proposals had yet to communicate Skydance’s final offer. This deal would involve Skydance acquiring Redstone’s National Amusements Inc. and merging with Paramount Global. The exclusive negotiation window between Skydance and Paramount Global’s special committee is set to close at midnight on Friday.
On another front, the Paramount board’s special committee plans to review the joint Sony-Apollo offer worth $26 billion in cash after the Skydance negotiation window expires in May. However, insiders anticipate that the proposal will face significant regulatory obstacles, making it an unlikely choice for Paramount Global.
Redstone, with the final decision-making power, has shown reluctance towards selling her family’s media company to a private equity buyer. While the Sony-Apollo offer may be appealing to nonvoting shareholders, the threat of legal action looms if Redstone rejects the offer, indicating that Paramount Global may not proceed with either option.
Representatives for Paramount Global, Skydance, and National Amusements have refrained from comments. The situation remains fluid, with no firm decisions made on Paramount or Redstone’s next steps. Should the merger talks fall through, Paramount Global will likely be led by the “Office of the CEO” consisting of George Cheeks of CBS, Brian Robbins of Paramount Pictures, and Chris McCarthy of Showtime/MTV Entertainment Studios and Paramount Media Networks, who are working on a long-term plan for the company.
Analysts suggest that Paramount Global is gearing up to operate independently, speculating on potential strategies to reduce the company’s debt load, including selling assets like BET Media Group and the iconic Paramount Pictures Studio lot. The future plan might also involve integrating the Paramount+ streaming service with NBCUniversal’s Peacock.
The LightShed Partners analysts believe that National Amusements may face legal challenges if they proceed with the Skydance deal, causing delays. Regarding the Sony-Apollo bid, they anticipate regulatory hurdles due to restrictions on studio consolidation and foreign ownership, potentially prolonging the approval process.
Can Redstone and the Paramount Global team navigate the company’s future without relinquishing control? The industry awaits the outcome eagerly, poised to witness the unfolding developments.
