Skydance Media CEO David Ellison is reportedly considering an all-cash bid to acquire National Amusements, the parent company of entertainment giant Paramount Global, Reuters reported on Jan. 10 citing sources. The report confirmed an earlier report by the Wall Street Journal on the same development.
If successful, Ellison may secure control of National Entertainment with financial backing from Skydance’s existing investors, including The Ellison family, RedBird Capital Partners and Tencent. Later, there are intentions to pursue a merger between Paramount Global and Skydance, known for producing films such as “Top Gun: Maverick” and “Mission: Impossible — Dead Reckoning Part One.”
Early Stage Talks
However, it is essential to note that discussions are in the early stages, and there is no certainty that an agreement will be reached, as warned by the source.
Paramount often receives expressions of interest in acquiring Paramount Pictures, famous for its classic movie library, including “Star Trek,” “The Godfather” and “Indiana Jones.”
Shari Redstone, who runs Paramount, was hesitant to part with the prestigious studio. However, the challenges of the global entertainment industry have significantly affected the value of the company, with more than $16 billion in losses since the 2019 CBS and Viacom merger. The current market capitalization stands at $9.4 billion, lower than Viacom’s pre-merger valuation.
Despite the reluctance, sources close to Redstone suggest she sees the company as “grossly undervalued” and would consider a deal that “makes sense,” the report added.
Analysts estimate Paramount’s value at $38.8 billion, with individual sales of its networks, production assets and DTC business potentially yielding about $38 per share.
Preliminary Agreement Discussions
In December 2023, reports revealed discussions between Warner Bros. Discovery CEO David Zaslav and Paramount CEO Bob Bakish regarding a possible deal.
National Entertainment, with a 77 percent stake in the voting shares of Paramount, also controls CBS, Nickelodeon, Comedy Central, and owns 800 movie screens in the United States.
The report added that National Amusements and Larry Ellison did not respond to inquiries, while Paramount declined to comment on the matter.
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Published: 11 Jan 2024, 06:41 IST
(tagsTo Translate)business