Investors in Paramount Global have slammed Shari Redstone over a deal to sell the company to Skydance Media, claiming the heiress is trying to line her own pockets at the expense of public shareholders.
Matrix Asset Advisors implored Paramount’s board in a letter Monday to reject Skydance’s proposed merger with the media giant, calling it “detrimental” to the company’s value and private equity firm Apollo Global. demanded that the US dollar 26 billion proposal be reconsidered.
The media conglomerate’s deal with Paramount and Skydance, which has produced such blockbusters as Mission: Impossible, Dead Reckoning, Transformers: Return of the Beast and Top Gun: Maverick, for Paramount It may acquire independent studios. The all-stock deal is worth approximately $5 billion.
According to reports, under the terms being discussed, Redstone and its National Amusements Co., which controls Paramount, the owner of Hollywood studio Paramount Pictures, CBS, MTV and Comedy Central, would be the first party in the deal. The company will receive more than $2 billion in cash at this stage.
Matrix, which currently owns 355,445 shares of Paramount stock and has more than $1 billion in assets under management, said that “the majority of shareholders will not receive a similar premium and the transaction will significantly dilute shareholder value.” “We will be forced to fund a speculative investment in Skydance.” ”
“Overall, this transaction, as contemplated, would have an adverse impact on the value of the company and would be contrary to the board’s fiduciary duties,” Matrix said, adding that this would result in the company’s remaining interests being He noted that it would be a “home run” for Redstone at the expense of -Controlling shareholder.
Matrix added that it was “particularly galling” that the board had not seriously considered Apollo’s proposal, given concerns reportedly about transaction funding.
Accordingly, Matrix asked the Board to give Apollo the same considerations as Skydance, namely 30 days of due diligence and confirmation of financing.
Skydance, owned by David Ellison, son of billionaire Oracle co-founder Larry Ellison, has entered into exclusive merger negotiations with a committee of Paramount’s independent directors.
Paramount, which was formed in 2019 through the merger of Viacom and CBS, has seen its stock price fall by nearly half over the past year. The market capitalization is approximately $8 billion.
“It is unfortunate that Ms. Redstone is in dire need of raising capital at a time when Paramount’s stock price is in decline. However, her particular problems have led to It should not be a disadvantage,” Matrix added.
“Failure to do so would amount to a breach of your responsibilities as a director of a publicly traded company, likely result in shareholder litigation, and forever cast a shadow on your tenure as a director of Paramount Global.” concludes.
Representatives for Paramount, National Amusements and Skydance had no immediate comment.
