Paramount Global Shares Drop After Parent Company Ends Merger Negotiations With Skydance

Published 1 month ago
By Forbes | Antonio Pequeño IV
Los Angeles Economy
Paramount logo is seen on the building in Los Angeles, United States on November 13, 2023. (Photo by Jakub Porzycki/NurPhoto via Getty Images)

TOPLINE

Paramount Global shares slid nearly 8% shortly before market close Tuesday after National Amusements, the media conglomerate’s parent company, scrapped merger discussions with Skydance Media, according to multiple outlets, bringing an end to a tedious, months-long negotiation process.

KEY FACTS

National Amusements owner and controlling Paramount shareholder, Shari Redstone, ended discussions with Skydance, according to The Wall Street Journal, which noted Redstone will likely look to sell off National Amusements without merging Paramount with another company.

Paramount Global shares closed down 7.8% at $11.04, erasing small gains made by the stock in late May.

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The merger deal would have involved Skydance acquiring National Amusements for about $1.7 billion, the Journal reported—though other reports have said the price tag was closer to about $2.2 billion, according to Bloomberg.

Skydance did not immediately respond to Forbes’ request for comment.

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BIG NUMBER

About 77%. That’s how much of Paramount’s voting class A common stock National Amusements owns.

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KEY BACKGROUND

Skydance reached a tentative agreement in April to buy Redstone’s controlling stake in Paramount, entering a 30-day exclusive negotiating window that expired shortly after a joint bid for the entertainment conglomerate was made by Sony and private equity firm Apollo Global Management. The Sony-Apollo takeover bid involved a $26 billion offer for Paramount Global, one that would have made Sony the majority shareholder in Paramount and Apollo the minority shareholder. That takeover is being reconsidered following investor concerns about Sony’s finances, Bloomberg reported, as the company’s shares have fallen nearly 9% this year. Redstone has sought a merger as Paramount has dealt with mounting debt ($14.6 billion at the end of 2023) and troubles with its Paramount + streaming numbers. The company reported $286 million in streaming losses in the first quarter of this year, improving upon a $511 million streaming loss posted in the same period last year.

FURTHER READING

Paramount May Reportedly Turn Down Both Skydance And Sony Deals—What We Know About The Negotiations (Forbes)

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