Paramount has taken the first steps toward a potential sale of the entertainment giant, despite media mogul Byron Allen’s proposed $14 billion takeover bid, the Post reported.
The company’s board has established an independent committee outside of Shari Redstone, the media heiress who owns a controlling interest in Paramount, to consider strategic alternatives, including a possible auction of the company. This was revealed by two sources close to the situation.
The board’s move comes after Allen, a comedian-turned-investor who also owns the Weather Channel, said he had made a $14.3 billion offer to buy all of Paramount Global’s outstanding stock. It was received and carried out. The company also offered to assume Paramount’s $15.6 billion in debt.
Shares of Paramount Global, which owns its namesake movie studio as well as cable networks including CBS and MTV, BET, Nickelodeon and Comedy Central, rose more than 6% on Wednesday.
Still, some are skeptical that Allen’s bid will lead to a deal.
Paramount Global has not yet responded to Allen’s offer, sources said.
“I like the fact that Byron is offering a premium to all Paramount shareholders,” legendary investor Mario Gabelli told the Post on Wednesday. “But show me the money. I don’t know where Byron gets his money.”
Gabelli, who owns a stake in National Amusements, a holding company that controls Paramount with 80% voting power, added that he could not specifically confirm whether Paramount had established an independent committee to consider strategic alternatives. .
“I’m pretty optimistic that something is happening,” Gabelli said. “I think the timing of Mr. Byron’s bid is appropriate.”
If Mr. Allen is successful in acquiring the company, he would sell the Paramount movie studio, real estate and other intellectual property while retaining its television assets, including the Paramount+ streaming service, and create a more cost-effective base, according to people familiar with the matter. The plan is to operate it. I received an explanation of Allen’s plan.
“We believe this $30 billion offer, including debt and equity, is the best solution for all of Paramount Global’s shareholders, and this offer will be taken seriously,” Allen Media Group said in a statement Wednesday. This should be promoted.”
Mr. Allen has been eyeing a major acquisition in the television industry in recent years, but has yet to sign a deal.
He made a $10 billion bid for Disney-owned ABC Television and $8.50 for TV station owner Tegna.
Mr. Allen also tried to buy Black Entertainment Television for $3.5 billion.
In response to skepticism about whether Mr. Allen had the money, one person said Mr. Allen had arranged financing for about $3 billion worth of studio real estate.
As the Post reported, Redstone quietly began a formal auction for the National Recreation Complex earlier this month.
Apollo Global Management is among the potential bidders who have been sent non-disclosure agreements giving them access to Paramount’s finances, the people said.
National Amusements’ potential bidders include Skydance, the studio led by David Ellison, which co-produced “Top Gun: Maverick” with Paramount, people familiar with the matter told the Post.
Redstone and Skydance are “close in price” with National Amusements, according to a person familiar with the matter. However, the person added that Skydance’s acquisition of Paramount Pictures also requires consent and approval from Paramount’s board of directors is required for the deal to close.
In fact, Redstone also “wants to sell everything, not just the holding company,” a source close to Redstone told the Post earlier this month, adding at the time that he feared “there might not be a bid.” Was.
Ellison, the CEO of Skydance Media and the son of Oracle founder Larry Ellison, is seeking control of National, the Redstone family’s holding company, as a way to take control of Paramount Pictures. A person close to the situation revealed that the company has made a tentative proposal to acquire Amusement Inc.
The debt-ridden entertainment giant plans to begin cutting hundreds of jobs in February. Deadline reported Early this month.
news Following a report from the Wall Street Journal The company announced in December that it was considering potentially cutting more than 1,000 jobs in early 2024 to cut costs.
