Even when you think it’s over, Skydance Media’s potential buyout of Paramount Global isn’t. Paramount now has the right to search for a better offer in the next 45 days. If the company accepts another offer, it will owe Skydance a $400 million breakup fee.
Skydance founder and CEO David Ellison told investors about the fee on a call Monday morning. A special committee composed of Paramount’s board of directors will be able to “actively solicit and evaluate alternative acquisition proposals” during this 45-day window. This shop clause was added as an alternative to giving Paramount Global’s nonvoting shareholders approval over the deal.
Paramount noted during the call that it “does not intend to disclose developments with respect to the go-shop process unless and until it determines such disclosure is appropriate or is otherwise required.”
After months of speculation, Paramount Global was sold to Skydance Media in an $8 billion deal that was announced Sunday. This deal will merge David Ellison’s Skydance with the legacy Hollywood studio and Shari Redstone’s National Amusements Inc. This will mark the end of the Redstone family having the controlling stake of Paramount, a position the family has held since the early 1990s when Viacom merged with Paramount. Paramount Global includes not only Paramount Studios but also Paramount+, CBS, MTV, Nickelodeon and Pluto.
“Given the changes in the industry, we want to fortify Paramount for the future while ensuring that content remains king. Our hope is that the Skydance transaction will enable Paramount’s continued success in this rapidly changing environment,” Redstone said in a statement about the latest deal.
If this deal goes through, Paramount is being dubbed “New Paramount.” Ellison will be named chairman and Chief Executive Officer, and former NBCUniversal CEO Jeff Shell will be named president. The deal is expected to close in the first half of 2025. During the Monday morning call, Shell said the Skydance team identified more than $2 billion in cost-savings annually, a number that includes $1 billion in the first year.
