Media mogul Barry Diller indicated Friday that his company, IAC, has withdrawn from the race to buy Paramount Global, CNBC reported Friday.
“It’s hard to predict, but for us it’s over,” said the chairman and senior executive of the New York-based digital media conglomerate, which owns brands such as Dotdash Meredith, Care.com and The Daily Beast. During an interview with CNBC.
Diller had reportedly been seeking to buy Paramount after the embattled entertainment giant repeatedly delayed merger talks with tech heir David Ellison’s Skydance Media.
The two parties reached a deal in early July for Skydance to acquire National Amusements, the family holding company of Shari Redstone, which owns a controlling stake in Paramount, for $1.75 billion.
The deal included a “45-day go-shop” period during which Paramount could seek a better offer.
Diller’s comments indicate he is no longer a suitor.
The billionaire said he would be “shocked” if the merger did not face enormous legal challenges.
Already, Paramount Global investors have filed a lawsuit to block the merger, arguing the deal would cost shareholders $1.65 billion.
The lawsuit, filed by Scott Baker, alleges that the merger’s main purpose was to allow Paramount Chairman Redstone to cash out his investment at an inflated price while other shareholders would receive smaller dividends.
The lawsuit, filed Wednesday, argues that the potential merger is “unfair,” and the unrest suggests more lawsuits from disgruntled investors could be on the way.
Paramount’s contract with Skydance requires that Paramount find a better offer within 45 days. If the media giant finds a better offer that Skydance isn’t willing to match, Paramount will have to pay Skydance a $400 million termination fee.
Meanwhile, Mario Gabelli of Gabelli Asset Management Company Investors has reportedly asked for more information about the valuation of National Amusements’ assets, suggesting the billionaire may challenge the Skydance deal.
Gabelli’s investment firm wrote to Paramount’s general counsel in early July seeking more information, a source close to Gabelli told Reuters.
