Paramount gets new $13.5 billion offer from investor group
Paramount gets new $13.5 billion offer from investor group
The offer could send Paramount’s merger with Skydance into chaos if given consideration by the Paramount board.
Hopefully, someone is keeping an eye on David Ellison’s blood pressure. The Skydance Media CEO is just trying to get his company’s merger with Paramount Global across the finish line, but new problems continue to crop up. The latest, according to an exclusive report from Variety, comes in the form of a letter from a group of investors who want to buy Paramount for themselves, with an offer that could be considerably better than the terms agreed to by Paramount and Skydance last summer.
Key Details:
- The investor group has come through with an offer to buy Paramount for $13.5 billion.
- The merger between Paramount and Skydance has been met with disapproval by some in the marketplace.
- As a publicly traded company, Paramount is bound by law to consider the new offer.
The new investor group offer for Paramount Global comes from Project Rise Partners. Its members are somewhat shrouded in mystery, but they’re known to include Cinémoi president Daphna Edwards Ziman, real estate CEO Moses Gross, and the backing of “titans of industry comparable to Larry Ellison,” the billionaire who is backing his son David’s attempt to purchase Paramount and merge it with Skydance.
The new bid is for $13.5 billion, which on paper is much larger than Skydance’s $8 billion offer. The letter to Paramount’s board detailing Project Rise Partners’ offer says that considering “the market’s negative reaction to the Skydance transaction, PRP is now increasing its offer as follows: The offer for the B shares is $19 per share compared to $15 per share in the Skydance offer — a 75% premium and 27% more than Skydance. The PRP offer for the A shares remains the same as the Skydance offer. PRP will add $2B to the balance sheet. This is an all-cash offer with committed financing from credible investors.”
This isn’t the first major challenge to Skydance’s plans to acquire Paramount since the two companies agreed to their merger deal last summer. Soon after, former Warner Music executive Edgar Bronfman Jr. came in with a bid during the “go-shop” window for the transaction. That bid soon fell apart, however, when it became clear that Bronfman’s financing wasn’t completely lined up.
That might not be an obstacle for Project Rise Partners if they are backed by as much hefty capital as the report suggests. That won’t make Skydance happy, but there’s little it can do if Paramount decides to move forward with negotiations. As a publicly traded company, Paramount has a legal obligation to consider any offers that can benefit shareholders.
PRP also made a bid for Paramount in 2024, and in October sent the company a letter saying it had violated its duty to shareholders by not considering that $8.5 billion offer. According to Paramount, however, an official offer wasn’t made until the “go-shop” period built into the Skydance deal had ended.
The Skydance deal has had its share of detractors. In December, a group called the Center of American Rights filed a protest against the transaction with the Federal Communications Commission. Skydance had to sweat out that complaint as part of the public commentary phase of its merger with Paramount, and now it has seen the heat turned up once again.
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