Topline
The sale of Paramount Global to Skydance Media or Sony appears to be growing more unlikely, according to multiple outlets, as it looks to continue to narrow its streaming losses and navigate the departure of its former CEO.
Key Facts
Paramount’s special board committee in charge of considering mergers and acquisitions has backed off from an offer made by Skydance Media—founded by billionaire Larry Ellison’s son David—to acquire Shari Redstone’s controlling stake in Paramount and merge the two companies, according to The Hollywood Reporter.
Skydance’s 30-day exclusive negotiating window ends Friday and is not likely to be extended, The Hollywood Reporter added, noting a source close to the deal says talks are continuing.
Paramount’s special committee will still review a $26 billion all-cash buyout from Sony and Apollo Global Management reportedly made Thursday, according to Variety, noting insiders expect the deal may fall through because of anticipated regulatory hurdles.
The potential regulatory issues surrounding Sony’s offer concern Apollo’s existing ownership of broadcast TV stations and Sony being a Japanese company, according to The Hollywood Reporter.
The Sony-Apollo deal appears to be more appealing to Paramount’s non-voting shareholders compared to the Skydance deal, Variety noted, adding if the Sony offer does not work, Paramount is most likely to not proceed with either deal considering the potential of investor legal action against the Skydance deal.
Representatives for Paramount and Sony did not immediately respond to Forbes’ request for comment.
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Tangent
Paramount Global shares closed down 7% on Friday at $12.89. The company’s stock had positive reactions to reports of its potential merger with Skydance and Sony-Apollo’s takeover bid, jumping upwards of 13% on two separate occasions.
Forbes Valuation
We estimate Marc Rowan, the CEO and co-founder of Apollo, has a net worth of $6.5 billion.
Key Background
Paramount also received separate offers from Apollo and Warner Bros. Discovery prior to receiving and considering the recent deals from Skydance and Sony. If the media conglomerate passes on the two offers, it will be tackling its business matters with the help of three division chiefs at the helm of the company who were brought in to replace former CEO Bob Bakish this week. Paramount reported $286 million in streaming losses in the first quarter, an improvement over the $511 million in streaming losses it recorded in the same period last year. The company has $14.6 billion in debt.
Further Reading
Paramount Stock Jumps 13% After Reported $26 Billion Sony-Apollo Takeover Bid (Forbes)
Paramount Global Shares Hit 14-Year Low—Then Rebound—As Board Members Reportedly Depart Amid Merger (Forbes)
