Paramount Global, one of Hollywood’s oldest companies, has agreed to merge with the independent film studio Skydance Media.
This merger involves Shari Redstone, Paramount’s non-executive chair, selling her family’s controlling stake in a transaction that will create a new firm valued at approximately $28 billion (£21.9 billion).
This deal signifies the end of an era for the Redstone family, whose late patriarch, Sumner Redstone, built a vast media empire from a chain of drive-in cinemas. Paramount Global’s portfolio includes renowned television networks like CBS, Comedy Central, Nickelodeon, and MTV.
“Our hope is that the Skydance transaction will enable Paramount’s continued success in this rapidly changing environment,” Ms. Redstone stated.
Paramount’s TV channels reportedly have a global reach of over 4.3 billion subscribers across more than 180 countries.
The merger will unite Paramount, known for classic films such as “Chinatown” and “Breakfast at Tiffany’s,” with its financial partner on several recent blockbusters, including “Top Gun: Maverick” and “Star Trek Into Darkness.”
Skydance plans to invest around $8 billion in Paramount, which includes paying $2.4 billion for National Amusements, the entity controlling the group.
Despite owning just 10% of Paramount Group’s shares, National Amusements holds nearly 80% of its voting rights. Paramount anticipates finalizing the deal by the summer of next year.
Founded in 1914, Paramount Global traces its origins back more than a century to Paramount Pictures Corporation.
The studio has produced many hits, including the “Godfather,” “Star Trek,” and “Mission: Impossible” series.
However, the company has faced challenges over the past decade, with Paramount Global’s shares dropping by more than 75% in the last five years.
Skydance is owned by David Ellison, son of Larry Ellison, founder of the US technology giant Oracle.
The announcement followed eight months of negotiations, during which Redstone held talks with various potential partners, including Sony and private equity firm Apollo.
Paramount’s chief executive, Bob Bakish, left the company in April after disagreements with Ms. Redstone over the planned Skydance deal.
This merger occurs amid a transformation in the global entertainment industry driven by the rise of video streaming.
Source-BBC
