Paramount co-CEOs George Cheeks, Brian Robbins and Chris McCarthy expressed their thanks to the media giant’s staff following news that its pending $8 billion merger with Skydance Media is expected to close Aug. 7.
“As we near the end of a historic chapter for Paramount and prepare for a new era, we want to thank you for your resilience, creativity and dedication,” the trio wrote in a memo shared with staff on Friday. “Because of you, Paramount is in a much better place today than it was a year ago, and it has been an honor to lead the company over the past year and work alongside you.”
Cheeks, Robbins and McCarthy called the Skydance deal a “significant milestone” for Paramount and noted they would provide updates on the transition as soon as information becomes available.
Paramount and Skydance’s merger talks first surfaced in December 2023. In March 2024, the media giant’s credit rating was downgraded to junk status by S&P global, which warned more would be forthcoming unless it substantially improved its streaming losses.
By April 2024, Paramount and Skydance entered exclusive discussions, which ended up expiring with no deal. However, after months of continued negotiations, and a temporary collapse of talks and competing bids, the two sides were able to broker a deal on July 7, 2024.
The merger was then subjected to a 251-day regulatory review from the Federal Communications Commission due to a required transfer of broadcast licenses, which ended on Thursday. In order to get the deal over the finish line, Skydance committed to appoint an ombudsman at CBS for at least two years to review complaints of bias as well as eliminate all diversity, equity and inclusion (DEI) initiatives at Paramount.
During that review, Paramount also agreed to reach a $16 million legal settlement with President Donald Trump over the editing of an Oct. 7 “60 Minutes” interview with former Vice President Kamala Harris.
Cheeks, Robbins and McCarthy were elevated to the Office of the CEO following the resignation of former Paramount CEO Bob Bakish in April 2024 in the midst of the Skydance talks. In addition to serving as co-CEOs, they are the CEOs and presidents of CBS, Paramount Pictures and Nickelodeon, Showtime/MTV Entertainment Studios and Paramount Media Networks, respectively.
Following their promotion, the executives were tasked with embarking on a plan to cut $500 million in costs, which included a 15% workforce reduction and the shuttering of Paramount Television Studios. Those cuts were part of at least $2 billion in cost savings identified by incoming CEO David Ellison and president Jeff Shell.
In June, Paramount said they would cut another 3.5% of the workforce as they look to manage declines in the linear TV business while prioritizing investments in streaming. Additionally, the company launched a review of its international pay TV strategy, which could see a potential reduction in its local cable channel footprint in international markets.
Paramount+ is currently on track to reach domestic profitability in fiscal year 2025.
FCC Clears Paramount-Skydance Merger
Under the two-step deal, Skydance is set to acquire controlling shareholder Shari Redstone’s holding company National Amusements, which controls 77.4% of the Paramount Class A common stock outstanding and approximately 9.5% of the overall equity of the company, before merging with the Hollywood studio.
The deal provides $2.4 billion for Redstone, $4.5 billion to non-NAI Paramount shareholders and an additional $1.5 billion in new capital to help pay down debt and recapitalize the company’s balance sheet.
Skydance’s consortium of investors, which includes RedBird Capital Partners and the Ellison family, will control 70% of shares outstanding and have 100% voting ownership in New Paramount. The combined company will have an enterprise value of $28 billion, while Skydance is being valued at $4.75 billion.
Following the deal’s closing, Redstone will exit Paramount’s board of directors and McCarthy will exit the company. Reps for Robbins and Cheeks declined to comment. New Paramount’s stock will also begin trading on the Nasdaq under a new ticker symbol: PSKY.
Shares of Paramount, which closed at $13.08 apiece on Friday, have fallen 47% in the past five years, but are up 13.8% in the past year and 23.3% year-to-date. As of the end of Friday’s trading session, Paramount has a market capitalization of $9.19 billion.
Read the full memo from Cheeks, Robbins and McCarthy below:
Hi Everyone,
We have some important news to share related to our Skydance merger. We received our final regulatory approval and we anticipate the Skydance merger will close (or be complete) on August 7th, subject to customary closing conditions.
This is a significant milestone for our entire global organization. We realize you will have many questions about the transition process, and we will provide updates as soon as the information becomes available to us.
Collectively, we have been in the industry for decades and, like you, we have called Paramount our home and together we have seen the incredible evolution of the entertainment industry. Through all of these changes, Paramount has made great progress – none greater than over the past year. We truly have momentum as a company and that’s a testament to you, our talented teams, with your incredible ability to deliver hit shows and blockbuster films, and all the critical pieces that make those things happen behind the scenes from BALA, finance, HR, communications, marketing, technology, distribution, partnerships, sales, consumer products, government relations and more – even in the context of a rapidly evolving landscape.
As we near the end of a historic chapter for Paramount and prepare for a new era, we want to thank you for your resilience, creativity and dedication. Because of you, Paramount is in a much better place today than it was a year ago, and it has been an honor to lead the company over the past year and work alongside you.
Best,
George, Chris and Brian
