Production Company Behind ‘Top Gun: Maverick,’ ‘Mission Impossible’ Latest to Explore Paramount Acquisition
Skydance has teamed with Paramount on several hit movies recently, including ‘Top Gun: Maverick.’
Is Paramount going dancing in 2024? It seems possible, as a new report from The Wall Street Journal indicates that Skydance Media, a California-based production company, is the latest group to engage Paramount’s controlling shareholders in a discussion about a potential acquisition.
- Skydance is reportedly interested in acquiring all of Paramount’s assets in a cash deal.
- Discussions between Paramount and Skydance representatives are reportedly further along than talks between Paramount and Warner Bros. Discovery.
- Paramount is having a tough time working out the economics of streaming as traditional cable declines.
Will Skydance Succeed in its Pursuit of Paramount?
Skydance and Paramount are quite familiar with each other. The Paramount-distributed hit “Top Gun: Maverick” was produced in part by Skydance, which also helped make “Transformers: Rise of the Beasts” and “Mission Impossible - Dead Reckoning Part One,” all of which currently stream on Paramount+. Skydance has also had a hand in creating TV series like “Reacher” on Prime Video and films like “The Family Plan” on Apple TV+.
The WSJ reports that Skydance Media CEO David Ellison is discussing an all-cash bid for Paramount, backed by investors including his father, billionaire Larry Ellison. The deal would encompass at least a majority stake in National Amusements, the parent company of Paramount Global owned by the Redstone family.
Talks are still in preliminary stages, and could easily still come to naught. But the Journal reports that discussions are further along than merger talks between Paramount and Warner Bros. Discovery, which were first reported in December. WBD remains interested, but talks have not progressed any further. Skydance would have a bit of an easier time with regulators concerning an acquisition of Paramount, as the company does not currently own any broadcast or cable TV channels.
Why Are Sale Talks Around Paramount So Numerous?
A deep dive into Paramount’s finances would be somewhat tedious and confounding, but suffice it to say it has had difficulty cracking the profitability equation for its streaming services. At last count, Paramount+ had a relatively impressive 63 million global subscribers, but it has had difficulty building scale on a level of top streaming platforms like Netflix and Disney+.
Paramount carries a debt load of around $15.7 billion, which is not as much as a company like WBD, but is still a substantial amount. That debt has barely come down in the past year, which has been a focus for WBD and other major entertainment companies. While Paramount+ grew by 61% in the third quarter of 2023, it may be too little, too late. It will be difficult for the company to build out its streaming subscribers in a meaningful way unless its potential bundling of Paramount+ with Apple TV+ is just the first of many new streaming bundles in the company’s future.
Paramount’s controlling owners may not have the type of patience that will be required to make Paramount a profitable streaming outfit. That’s likely why so many sale talks have cropped up around the company as of late; the Redstone family may be thinking it’s time to get some cash and move along. Even if no sale of the company materializes, it’s a good bet that more discussions around a possible acquisition of Paramount Global will arise in 2024.
Paramount Plus
Paramount+ is a subscription video streaming service that includes on-demand access to 40,000+ TV show episodes from BET, CBS, Comedy Central, MTV, Nickelodeon, Nick Jr. and more. The lineup includes “1883,” “Tulsa King,” “Star Trek: Discovery,” Nickelodeon’s “SpongeBob SquarePants,” and “PAW Patrol.” Subscribers can watch the NFL, college football, The Masters, college basketball, UEFA Champions League, UEFA Europa, Serie A, and NWSL. The service also offers the option to watch your live CBS affiliate. The upgraded ad-free package includes premium movies and shows from Showtime.