Paramount-Skydance Deal Unlikely to Close in 30-Day Window, Due Diligence Continues | Exclusive

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The deal, which requires approval by the Paramount board, is likely to take closer to 60 days, an insider tells TheWrap

Skydance Media CEO David Ellison and National Amusements President Shari Redstone
Skydance Media CEO David Ellison and National Amusements President Shari Redstone (Getty Images / Illustration by TheWrap)

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A deal to merge Paramount Global and David Ellison’s Skydance Media is unlikely to conclude by May 3 — the end of a 30-day exclusivity window — but is moving forward despite pressure from shareholders eager to consider other bids, TheWrap has learned.

According to an individual with knowledge of the negotiations, Skydance’s due diligence on Paramount began this week and will not be complete within two weeks. The individual said the process to hammer out details could take up to 60 days, and in that case the window of exclusivity could be extended.

The deal, which would be backed by fresh capital from a consortium of investors including Oracle cofounder Larry Ellison, RedBird Capital Partners and KKR, would see Skydance acquire control of the company through Shari Redstone’s National Amusements, which currently owns 77.3% of Paramount Global’s Class A (voting) common stock and 5.2% of its Class B common stock.

But shareholders have threatened to sue Paramount if Redstone fails to consider a competing bid from private equity giant Apollo.

The individual described the deal as a recapitalization of Paramount, in which the media conglomerate would be able to continue as a public company with the goal of eventually trading between $30 to $40 per share.

The stock is currently trading below $11 per share.

The Wall Street Journal has previously reported that Redstone’s National Amusements could receive over $2 billion in cash from the Skydance deal, some of which would be rolled over, according to the individual. Skydance would then be acquired by Paramount in an all-stock deal valued at around $5 billion.

The Ellisons would bring in technological and creative expertise from Skydance’s own existing management team, as well as Jeff Shell, who joined RedBird following his ouster as NBCUniversal CEO.

In addition to Skydance, Apollo has made a $26 billion all-cash offer for Paramount, though the media conglomerate has reportedly rebuffed the deal due to concerns around financing for the bid.

Meanwhile, Allen Media Group founder Byron Allen placed a $30 billion bid including debt for the company, though it’s unclear how that deal would be financed, and Paramount Global CEO Bob Bakish met with Warner Bros. Discovery CEO David Zaslav in December about a potential merger, though those talks have since halted.

Any deal for Paramount would have to be approved by Paramount Global’s special committee of independent directors. Ellison would also have to sell the deal to Paramount’s minority shareholders, including notable investors like Mario Gabelli and Ariel Investments’ John Rogers Jr., who have emphasized they’d consider litigation if a deal does not fairly benefit their clients.

Paramount stock, which currently has a market capitalization of about $7.6 billion, has seen its shares fall 49% in the past year and 23% year to date.


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