Paramount Global to Merge with Skydance Media: A $28 Billion Deal
LOS ANGELES and NEW YORK, July 7, 2024 — In a groundbreaking move that promises to reshape the entertainment industry, Paramount Global, the parent company of Paramount Pictures and CBS, has announced its merger with Skydance Media. The deal, valued at an impressive $28 billion, will create a new media powerhouse known as “New Paramount.”
The Players- Skydance Media and Paramount Global
- Paramount Global: The entertainment giant behind iconic films such as “Top Gun” and “The Godfather,” Paramount Global owns CBS and has a rich legacy in Hollywood.
- Skydance Media: Founded by David Ellison, Skydance Media has made a name for itself with successful franchises like “Mission: Impossible” and “Terminator.”
Key Highlights of the Merger:
- Financial Powerhouse: The merger will take Paramount, CBS, and former Viacom assets out of the Redstone family. Skydance Media’s enterprise value is estimated at $4.75 billion, while the combined New Paramount will be valued at $28 billion.
- Investment: The Ellison Family and RedBird Capital Partners will invest over $8 billion in New Paramount. This infusion of capital will fuel creative endeavours and technological advancements.
- Leadership: David Ellison will serve as Chairman and Chief Executive Officer of New Paramount, with Jeff Shell as President. Their vision is to enhance and reinvigorate the marquee Paramount and CBS brands.
- Content Platform: New Paramount aims to be a creative-driven destination for storytellers. It will leverage best-in-class technology and modernized infrastructure to deliver content through wholly-owned direct-to-consumer platforms like Paramount+ and Pluto, while also enhancing CBS and Paramount’s linear networks.
- Profitability and Independence: The repositioning of Paramount will improve profitability, foster stability, and enable more investment in faster-growing digital platforms.
- Skydance’s Role: Skydance Media will merge with Paramount in an all-stock transaction. Skydance Media equity holders will receive 317 million Class B shares valued at $15 per share. The Skydance Investor Group, including the Ellison Family and RedBird Capital Partners, will own 100% of New Paramount Class A shares and approximately 70% of outstanding Class B shares.
- Premium for Stockholders: The per-share cash election amount offered to Paramount’s stockholders represents a 48% premium to the price of Class B stock as of July 1, 2024, and a 28% premium to Class A stock on the same date.
The Road Ahead
As New Paramount emerges, it promises to be a force to reckon with in the ever-evolving entertainment landscape. With a blend of creativity, technology, and financial muscle, this merger sets the stage for exciting content and industry innovation.
Stay tuned for more updates as New Paramount charts its course in the entertainment galaxy!
Disclaimer: The information provided in this article is based on publicly available sources and should not be considered financial advice. Always consult professional advisors for investment decisions.
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