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  • Writer's pictureRealFacts Editorial Team

Paramount Global Merger Talks Send Stock Soaring


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Paramount Global (PARA), the media and entertainment company, has recently been in the spotlight due to its ongoing merger discussions with Skydance Media. Additionally, Apollo Global Management has been involved in these discussions in partnership with Sony Pictures. Kit Norton, an Investors Business Daily author, recently wrote, “Reports on April 19 said Apollo was in talks with Sony (SONY) for a joint bid on Paramount. The New York Times reported in late May that Sony and Apollo Global had signed nondisclosure agreements with Paramount, allowing them to look at Paramount's nonpublic financial information.”


The most recent update to the merger talks occurred before the markets opened Monday. Paramount Global Class B stock jumped 7.5% to $12.80 following reports that Paramount and David Ellison’s Skydance, backed by private equity firms RedBird Capital and KKR, had allegedly agreed to the terms of a merger deal. This deal would include Skydance purchasing nearly 50% of class B Paramount shares at $15 per share, which amounts to $4.5 billion. The remaining shares would be converted into shares of the newly combined company. Alongside this buyout, Skydance and RedBird Capital will inject $1.5 billion in cash into Paramount’s balance sheet to help reduce its debt burden.


The deal awaits signoff from Paramount’s controlling shareholder, Shari Redstone, who owns National Amusements, which controls 77% of class A Paramount shares. The revised deal values Paramount at $8 billion, which is $3 billion higher than Skydance's previous offer. Under the current terms, Shari Redstone is poised to receive $2 billion for National Amusements. If the merger is successful, Skydance and RedBird will collectively own two-thirds of Paramount, while class B shareholders will hold the remaining third. The deal does not require a shareholder vote, potentially expediting the process. Investors should watch for more information on this deal, which may be disclosed at Paramount’s annual shareholder meeting on Tuesday.

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