In the latest twist in the company’s mergers and acquisitions saga, Paramount GlobalThe Sony Pictures Entertainment and the Apollo Global Management made a bid to take Paramount private with an exorbitant all-cash takeover offer US$26 billion (via Variety).
Information indicates that Sony and Apollo, a private equity company, sent a letter with the non-binding offer this past Wednesday (01) to Paramount Global, as reported by Wall Street Journal. The offer, which would include the assumption of debt, comes as the special committee of Paramount Global’s board established to consider M&A proposals is evaluating Paramount Global’s best and final offer. Skydance Media to merge Paramount and Skydance while keeping Paramount Global public.
Still, Shari Redstonecontrolling shareholder of Paramount Global, remains inclined to consummate a deal with Skydance for David Ellisonwhose offer is supported by RedBird Capital Partners and for KKR.
Representatives for Paramount Global and the board’s special committee declined to comment. Representatives for Apollo and Sony Entertainment did not immediately respond to requests for comment.
Additionally, Paramount Global shares increased by more than 13% with the news of Apollo and Sony’s offer, rising to US$13.90 per share in afternoon trading.
It is unclear how Paramount’s board will proceed with the Sony-Apollo proposal, having rejected previous proposals from the company. The company has an exclusive negotiation window with Skydance, which ends this coming Friday, May 3rd – but discussions between both parties could extend beyond that.
If the proposal is accepted, the combination of Sony Pictures and Paramount Pictures would likely result in mass layoffs – and reduce the number of major Hollywood studios from five to four, after the Disney took control of the 20th Century Studios. Sony Corp., which acquired the Columbia Pictures in 1990 by US$3.5 billionis the largest studio operator in the industry that does not have a large-scale direct-to-consumer streaming service.
