(Bloomberg) — The Redstone family and independent film producer David Ellison are making a potential change in control of Paramount Global more attractive to the company’s other investors, according to people familiar with the talks. It is said that he offered concessions to make it a reality.
Most Read Articles on Bloomberg
Mr. Ellison is proposing to buy Paramount stock at a premium to its current price in order to strengthen the company's finances, said the people, who asked not to be identified discussing private discussions. The Redstone family, which owns a majority of the company's voting stock, agreed to give non-voting shareholders a say in whether the deal should be approved. Both sides are trying to close the deal in the face of a major shareholder revolt.
Skydance's bid was described Sunday by multiple parties as the “best and final offer.” Paramount's board has not yet decided whether to close the deal with Ellison, given the objections of other investors. Meanwhile, CEO Bob Bakish is expected to be replaced on an interim basis by the management committee as soon as Monday.
Skydance and Paramount declined to comment.
Ellison, the son of Oracle founder Larry Ellison, is in exclusive discussions with an independent committee of Paramount's board of directors regarding a potential transaction. His proposal includes buying out the Redstone family's controlling stake in Paramount and merging his Skydance Media into the company.
The deal, which was never formally announced, is an opportunity for the Redstone family to get some cash, but it is a dilutive position for non-voting shareholders who will have less ownership in the company. The idea faced opposition from many shareholders. Class B non-voting shares have fallen about 19% this year.
Read more: Paramount stock suffers from dilution risk
Paramount, the parent company of CBS, MTV and other media businesses, has struggled with the transition from traditional TV viewing to streaming. Advertising revenue on the company's TV channels is declining. The Paramount+ streaming service continues to lose money despite having about 67 million subscribers.
Several shareholders have urged the company to consider other offers, including negotiations with Apollo Global Management.
(Updates stock price trends in the 6th paragraph.)
Most Read Articles on Bloomberg Businessweek
©2024 Bloomberg LP
