Shari Redstone’s National Amusements has reached a preliminary agreement to sell its controlling stake in Paramount Global to David Ellison’s Skydance Media, according to a report.
Paramount had reportedly stopped merger talks with Skydance in June following the intervention of National Amusements.
The proposed new deal, valued at $1.75 billion, involves Skydance acquiring National Amusements’ 77% voting shares in Paramount, according to Reuters.
A 45-day “go-shop” period is included, allowing other potential bidders to submit their offers.
Potential bidders include film producer Steven Paul, Seagram heir Edgar Bronfman Jr., and IAC’s Barry Diller.
These interested parties might continue their bids, potentially offering more attractive deals for Paramount shareholders or Redstone personally.
The Skydance deal has been referred to a special committee of Paramount’s board for review.
Unlike previous negotiations, the current agreement does not require the approval of a majority of non-Redstone shareholders, which had been a significant hurdle, according to the Wall Street Journal, which first reported it.
The sale is anticipated to be the first phase of a two-step transaction, eventually leading to a merger between Skydance and Paramount.
Paramount has been actively seeking a potential buyer due to growing concerns about its financial stability from Wall Street and industry observers. The company recently announced a commitment to slash $500 billion from its budget to address these issues.
A major player in the media industry, Paramount boasts a portfolio that includes CBS, MTV, and Comedy Central.
Despite its influential position, the company has faced significant hurdles, similar to other media organizations, due to declining linear broadcast viewership and a challenging advertising market.
Paramount, a century-old studio known for iconic films like “Titanic,” “The Godfather,” and the “Transformers” series, has previously collaborated with Skydance on movies such as “Top Gun: Maverick” and “Star Trek Into Darkness.”
David Ellison, son of Oracle co-founder Larry Ellison, has been pursuing Paramount for months, a move supported by Shari Redstone, daughter of the late media mogul Sumner Redstone.
Although Redstone initially rejected the deal when Skydance revised its offer to allocate more funds to other shareholders, National Amusements re-entered negotiations with Skydance over the past week while also engaging with other interested parties.
National Amusements, which owns movie theaters in the U.S., Britain, and Latin America, holds the Redstone family’s 77% stake in Paramount’s Class A voting stock.
