Paramount Being Sold To Anyone With Enough Money?
Paramount is reportedly poised to be put up for auction, with Warner Bros. Discovery and Skydance Media engaged in discussions to secure a majority stake.
But now, media executive Shari Redstone, the predominant owner of Paramount, is considering selling her controlling interest to the highest bidder. That means both companies may have to contend with investment firms who want in.
Paramount Being Sold?
Redstone, the 69-year-old daughter of the late media mogul Sumner Redstone, is actively seeking potential buyers for National Amusements, the company holding a 10 percent stake in Paramount Global and controlling a substantial 77 percent of its voting shares.
The quest for bidders has led to a widening pool, including talks with Warner Bros. Discovery, Skydance, and RedBird Capital Partners.
Financial Challenges
Redstone is seeking a substantial markup for National Amusements, potentially up to 50 percent of Paramount Global’s market value.
With a market capitalization of $9.4 billion, the company faces financial challenges, exacerbated by a looming March deadline for a $37.5 million payment on a $175 million loan from Wells Fargo.
Merger With Warner Bros
The stakes are high, as National Amusements holds a considerable influence over Paramount Global due to its voting shares.
Warner Bros. Discovery has been in talks with Paramount Global CEO Bob Bakish about a potential merger.
Skydance, the Hollywood studio behind Top Gun: Maverick, is also exploring an all-cash bid for National Amusements with tech tycoon Larry Ellison, the founder of Oracle.
Deadline Looming Large
RedBird Capital Partners, supporting Skydance, has already conducted exploratory talks with Redstone about the potential acquisition of Paramount.
Despite the interest from various sources, financial and regulatory hurdles could pose challenges. National Amusements faces financial constraints, with a $125 million issuance of preferred stock in May 2023 adding to its debt load.
The $37.5 million payment deadline to Wells Fargo looms large, raising concerns about its ability to meet its obligations. Paramount Global’s attempt to sell the BET network to boost its stock price may not alleviate National Amusements’ debt, given Paramount’s own debt challenges.
Any potential acquisition of Paramount Global by tech giants would likely undergo antitrust scrutiny.
Paramount’s History
Moreover, the bid from RedBird might encounter regulatory challenges. Its joint venture, led by Jeff Zucker and named RedBird IMI, has allegedly secured $750 million in funding from Abu Dhabi.
However, it’s important to note that the funds invested by RedBird in Skydance are distinct and do not originate from the RedBird IMI fund.
Paramount began in 1912 when Adolph Zukor founded the Famous Players Film Company and began distributing his films through a company called Paramount Pictures.
In 1916, Zukor’s Famous Players merged with The Jesse L. Lasky Company, creating Famous Players-Lasky Corporation, which later became Paramount Pictures Corporation.
Huge Movies Through The Years
Over the years, Paramount has produced and distributed many iconic films, including The Godfather, Titanic, and many others.
In addition to its film production, Paramount has also been involved in television production and distribution, including shows like Star Trek, Cheers, and Frasier.
The company is part of Paramount Global, which includes various assets such as CBS, Paramount+, and cable channels like BET and Nickelodeon. The Redstone family still controls the company, which owns most of the voting stock through the family-holding company National Amusements.
Source: New York Post
