Paramount Global’s Deal with Skydance Gets Board Approval, Set to Close by 2025
Paramount Global’s Deal with Skydance Gets Board Approval, Set to Close by 2025
It appears some closure is finally in sight in the seemingly never-ending saga of Paramount’s merger with Skydance.
After numerous stops and starts, promising updates that led to nothing, and moments where it looked like talks had fallen apart for good, Paramount Global and Skydance Media are ready to make it official. Paramount’s board of directors has approved a deal that will see National Amusements Inc. — the holding company through which majority shareholder Shari Redstone controls Paramount’s voting stock — bought by Skydance, which will then merge itself with Paramount. Skydance and its backers will invest $8 billion to get their hands on a legacy media company with big-name brands, including the CBS television network and Paramount+ streaming service.
Key Facts
- The deal between Skydance and Paramount is expected to close by 2025.
- Redstone sent a letter to employees notifying them about the deal on Sunday.
- Paramount is already expected to sell BET, and other assets could follow under new ownership.
Now that the Skydance/Paramount merger has the approval of Paramount’s board of directors and Redstone herself, the two sides can actually move forward on executing the deal. Cash considerations totaling $4.5 billion will be paid to Paramount’s public shareholders, and Skydance and its partners will add $1.5 billion in primary capital to Paramount’s balance sheet in the process.
Former NBCUniversal head Jeff Shell will be the company’s president, reporting to Skydance’s Larry Ellison, who has led negotiations on that company’s behalf and will take over the role of CEO. The deal is still subject to a 45-day period in which Paramount can seek better deal terms, but Paramount has been on the sale table for months, and it’s unlikely that a sweeter offer will emerge now.
Redstone first gave approval to the deal last week, after nearly pulling the trigger on a pact with Skydance in June, then changing her mind at the last moment. Under the current deal terms, Redstone gets a little more money, plus added protections from lawsuits filed by other shareholders to try to stop the deal.
In a letter to company employees, Redstone said “As a longtime production partner to Paramount, Skydance is well aware of what we have accomplished over the years and it is for that reason that they have pursued a combination with Paramount. They have a clear strategic vision for the future and the resources to build on Paramount Global’s competitive advantages to drive the Company’s success.”
What Happens to Paramount Global Assets Now?
The merger of Skydance and Paramount is unlikely to trigger a response from federal regulators, as Skydance is a U.S.-owned company and does not own any broadcast TV assets currently. That will clear the path for it to become the owner of CBS, so it won’t have to follow my advice and sell the channel to Warner Bros. Discovery unless it gets an offer it can’t refuse.
A sale of BET looks far more likely, however. Paramount entered exclusive talks to sell the channel to its current CEO last week, and a deal could follow on quickly if the new powers that be at Skydance give their approval to a transaction. Skydance officials will be pouring over Paramount’s assets to see which will help the company further its new long-term goals, and which will not.
The future of Paramount+ is a bit less clear, at the moment. A report from last week indicated that Skydance had designs on breaking up Paramount’s streaming library to merge content with other companies and create multiple new streaming services, a plan which on its face seems to be the exact opposite of what market factors are calling for. Whether that will still be the strategy now that a merger deal is actually going forward remains to be seen.
The futures of all of Paramount’s assets are somewhat uncertain, but they’re being purchased by a Hollywood executive who loves movies and respects the legacy of Paramount as a company. Ellison buying Paramount should give audiences much less anxiety than if it were bought by a private equity firm that would likely have stripped it for parts. It will be fascinating to see what the company’s next steps are, now that it appears ready to put the chapter of its sale process to bed once and for all.
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. Get free access with a Walmart+ subscription.
Paramount+ includes “1883,” “Tulsa King,” “Star Trek: Discovery,” “SpongeBob SquarePants,” and “PAW Patrol.” Subscribers can watch the NFL, college football, The Masters, college basketball, UEFA Champions League, UEFA Europa League, 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.