Skydance reaches new deal to buy controlling Paramount stake, sources say By Reuters
By Dawn Chmielewski
LOS ANGELES (Reuters) -Shari Redstone’s National Amusements has reached a preliminary deal to sell the controlling interest in Paramount Global to David Ellison’s Skydance Media, three sources familiar with the matter told Reuters on Tuesday.
The unexpected development comes just weeks after Redstone abruptly ended talks with tech scion Ellison’s Skydance and began engaging with other potential buyers.
The news sent Paramount shares up 9% in after-hours trading.
Under the tentative agreement, Skydance would pay $1.75 billion for National Amusements, which owns 77% of the voting shares of Paramount. The deal includes a 45-day “go-shop” period, in which other bidders could submit offers, according to the Wall Street Journal, which first reported the news on Tuesday.
Other bidders that have expressed interest in acquiring National Amusements include film producer Steven Paul, Seagram heir Edgar Bronfman Jr. and IAC’s Barry Diller.
National Amusements has referred the Skydance deal to a special committee of Paramount’s board for review, according to two people familiar with the matter.
The National Amusements sale is envisioned as the first part of a two-phase transaction, in which the smaller independent studio Skydance would merge with Paramount, home of the namesake film studio, CBS and cable networks such as MTV and Nickelodeon.
Paramount declined to comment, and a spokesperson for the special committee could not immediately be reached for comment.
Ellison, the son of Oracle (NYSE:) co-founder Larry Ellison, has spent months in pursuit of Paramount, a combination that Redstone enthusiastically embraced, according to multiple sources.
National Amusements owns movie theaters in the United States, Britain and Latin America, and holds the Redstone family’s 77% of Paramount’s class A voting stock.
(Reporting Dawn Chmielewski in Los Angeles ; Additional reporting by Harshita Mary Varghese and Juby Babu; Writing by Lisa Richwine;Editing by Shinjini Ganguli and Lincoln Feast.)
