The president of Japanese PlayStation maker Sony said it would not make a new bid for Paramount Global, saying it “does not fit our strategy.”
Sony’s chief operating officer and chief financial officer, Hiroki Toki, told investors during an earnings call on Wednesday that the company would not make a new proposal for the entertainment conglomerate, which is controlled by Shari Redstone’s holding company National Amusements.
The media heiress last month inked a deal to sell 77 percent of NAI to Skydance Media, the independent film studio behind hits such as “Top Gun: Maverick” and “Mission: Impossible – Dead Reckoning Part 1,” for more than $8 billion.
The deal is on an on-again, off-again basis, giving Paramount a 45-day “study period” to consider competing bids. If it finds an offer it likes, it will owe Skydance a total of $400 million in break-up fees.
The “Go Shop” period will end on August 21st.
“If we had to acquire all of Paramount, it would be quite risky as it may not fit well with our capital allocation structure,” Toki said after Sony reported a 10 percent increase in operating profit for the April-June period.
Sony partnered with private equity firm Apollo Global in May to negotiate a deal to buy Paramount for $26 billion in cash.
However, Sony is reportedly reconsidering its bid after Paramount reported a 7% drop in profits for fiscal 2023.
Skydance is led by tech heir David Ellison and backed by private equity giants KKR and Redbird Capital Partners, with plans to merge Ellison’s studio with the entertainment giant if tough negotiations with Redstone finally move forward.
The combined company will be valued at approximately $28 billion.
With post wire
