Paramount Special Committee Votes on Documentation of Skydance Deal
Paramount Globalâs independent special committee has set a documentation vote on Tuesday for a merger deal with David Ellisonâs Skydance Media.
Skydanceâs latest revised offer, which is backed by a consortium of investors including RedBird Capital and KKR, was previously recommended by the committee in May. The bid would see Skydance acquire controlling shareholder Shari Redstoneâs National Amusements, which owns 77% of Paramountâs class A voting stock and 5.2% of its class B common stock. The second step would then see Skydance merge with Paramount to create a combined company.
A representative for Paramountâs independent special committee declined to comment. News of the vote was first reported by Puckâs Matt Belloni.
The update comes as the two sides have been negotiating for months on a potential deal. While Skydanceâs exclusive negotiating window expired in May, the two sides have continued to explore a deal and agreed to terms last week.
Skydanceâs bid has been revised multiple times in an effort to make a deal more equitable for Paramountâs class B shareholders, some of whom have previously argued that it would enrich Redstone at the expense of the rest of the companyâs investors and have threatened to sue. Â
In an effort to insulate herself from shareholder litigation, Redstone was seeking legal protection through indemnification and potentially giving minority shareholders a vote, according to The New York Times.
In addition to Skydance, Sony Pictures Entertainment and Apollo Global Management submitted a joint $26 billion all-cash offer for the company, which would see the former take a majority stake and operational control and the latter take a minority stake. While the pair signed NDAs to begin discussions with Paramount, The New York Times reported that they have since backed away from the original offer.
âBaby Geniusesâ producer Steven Paul also expressed interest in National Amusements, an individual familiar with the matter previously told TheWrap. Paulâs investor group, which includes John Paul DeJoria, the billionaire cofounder of PatrĂłn tequila and Paul Mitchell hair care products, is being advised by Rockefeller Capital Management. Edgar Bronfman Jr. and Bain Capital are also eyeing a bid for National Amusements in the range of $2 billion to $2.5 billion, The Wall Street Journal reported.
Representatives for National Amusements, Rockefeller Capital Management, Bain Capital and Waverly Capital, a venture capital firm where Bronfman serves as chairman and general partner, declined to comment. Bronfman Jr., Paul and DeJoria did not immediately return TheWrapâs request for comment.
Thereâs also the option that Redstone lets Paramount go it alone under the new strategy laid out by its Office of the CEO to reduce its $14.6 billion in long-term debt, return to investment grade metrics after a credit downgrade to junk status, and drive revenue and earnings growth.
That plan includes partnerships in streaming, $500 million in cost cuts and divesting assets. The group, which is made up of executives Brian Robbins, Chris McCarthy and George Cheeks, replaced former CEO Bob Bakish in April.
Paramount, whose stock has climbed 2% during Tuesdayâs trading session, is down 24% in the past six months, 15% year to date and 25% in the past year.
