OAN’s James Meyers
10:25 AM – Monday, June 3, 2024
Paramount Global and Skydance have agreed to terms on a merger between the two big entertainment companies that’s valued at $8 billion.
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Skydance agreed under the proposed deal with a Paramount special committee to pay $2 billion for Paramount’s parent company, National Amusements, which is controlled by majority stakeholder Shari Redstone, according to CNBC.
Additionally, Skydance will buy out almost half of Paramount’s class B shares at $4.5 billion, $15 a piece, which will give shareholders a stake in the new company, according to CNBC reporter David Faber.
Skydance will also pay down Paramount’s ongoing debt by adding $1.5 billion in cash to the studio’s balance sheet, according to CNBC.
Meanwhile, Redstone must sign off on the deal, which will not require a vote from the shareholders, which was a condition that was part of the negotiations, according to Faber.
Paramount’s annual shareholder meeting is scheduled for Tuesday.
The deal also gives two-thirds ownership of Paramount to Skydance and Redbird, while the remaining third will be controlled by Class B shareholders.
Shares also went up 7.4% higher on Monday, just after the opening bell on Wall Street.
The deal is valued at $8 billion in total, which is up from close to $5 billion under earlier terms discussed between Paramount and Skydance. CNBC previously reported that Redstone would have received less than $2 billion for her stake, and the class B shareholders would have been bought at $11 a share.
As negotiations continued to ramp up, Paramount’s C-suite has been rearranged over the past few months, with Bob Bakish stepping down as CEO in April. He was replaced by a trio of executives that were called the “Office of the CEO.”
The three executives now in charge are Chris McCarthy, president and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks, CBS president and CEO George Cheeks; and Brian Robbins, the head of Paramount Pictures and Nickelodeon.
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