As has been widely reported, Skydance Media and Paramount Global have announced that they have entered into a definitive agreement to form New Paramount – what they say is a next-generation media and technology leader, through a two-step transaction including the acquisition of National Amusements, which holds the controlling share stake in Paramount, and subsequently a merger of Skydance and Paramount Global.
The companies say the transaction combines the Skydance Investor Group’s financial resources, deep operating experience, and expertise in cutting-edge technology with Paramount’s iconic intelectual property, deep film and television library, proven hit-making capabilities, and linear and streaming platforms that reach millions of viewers. New Paramount aims to be a premier, creative-first destination for storytellers, dedicated to top-quality content and will be positioned to improve profitability, foster stability and independence for creators, and enable more investment in growth areas. The transaction will stabilize and strengthen Paramount as a world-class media enterprise, with a focus on technological advancements, across multiple entertainment platforms including animation, gaming, film, sports, news and television.
The management team of New Paramount, led by David Ellison as chairman and CEO and Jeff Shell as president, will draw on a wealth of operational experience and proven expertise in driving creative and media company growth designed to improve Paramount’s performance and foster further advancement.
Shari Redstone, chair of Paramount Global and chair, president, and CEO of National Amusements, Inc. said, “In 1987, my father, Sumner Redstone, acquired Viacom and began assembling and growing the businesses today known as Paramount Global. He had a vision that “content was king” and was always committed to delivering great content for all audiences around the world. That vision has remained at the core of Paramount’s success and our accomplishments are a direct result of the incredibly talented, creative, and dedicated individuals who work at the company. Given the changes in the industry, we want to fortify Paramount for the future while ensuring that content remains king. Our hope is that the Skydance transaction will enable Paramount’s continued success in this rapidly changing environment. As a longtime production partner to Paramount, Skydance knows Paramount well and has a clear strategic vision and the resources to take it to its next stage of growth. We believe in Paramount, and we always will.”
Importantly, the transaction preserves the more than 100-year-old legacy of Paramount as one of Hollywood’s most iconic production companies and CBS’s stature as a cherished source of news and entertainment. It also preserves American jobs, fosters continued innovation and secures a prosperous future for the creative community at Paramount, while protecting the legacy that viewers across the globe know and love.
With a 15-year history of partnering on highly successful projects, the Skydance-Paramount combination will unite key intellectual property and enhance Paramount’s exposure in cutting-edge and next-generation digital businesses. Skydance’s exceptional pool of in-house creative animation talent, led by pioneer John Lasseter, will expand Paramount’s animation capabilities as well as consumer products opportunities over the long-term.
Skydance offers Paramount critical investment and significant entrees into burgeoning new entertainment and media verticals with clear economic upsides. For example, Skydance brings state-of-the-art interactive and gaming proficiencies, including two in-house game developer studios with industry-leading franchises, such as Skydance’s upcoming console games in Marvel and Star Wars and hit VR game, The Walking Dead. Skydance also brings an exciting partnership with the NFL, which complements the resources of CBS and its local affiliates, creating a premier global multi-sports studio.
Ellison, founder and CEO of Skydance said, “This is a defining and transformative time for our industry and the storytellers, content creators and financial stakeholders who are invested in the Paramount legacy and the longevity of the entertainment economy. I am incredibly grateful to Shari Redstone and her family who have agreed to entrust us with the opportunity to lead Paramount. We are committed to energizing the business and bolstering Paramount with contemporary technology, new leadership and a creative discipline that aims to enrich generations to come.”
Gerry Cardinale, founder and managing partner of RedBird Capital said, “The recapitalization of Paramount and combination with Skydance under David Ellison’s leadership will be an important moment in the entertainment industry at a time when incumbent media companies are increasingly challenged by technological disintermediation. As one of the iconic media brands and libraries in Hollywood, Paramount has the intellectual property foundation to ensure longevity through this evolution – but it will require a new generation of visionary leadership together with experienced operational management to navigate this next phase. RedBird is making a substantial financial investment in partnership with the Ellison family because we believe that the pro forma company under this leadership team will be the pace car for how these incumbent legacy media businesses will need to be run in the future.”
On behalf of the special committee, Charles E. Phillips, Jr. said, “We are pleased to have reached an agreement that we believe delivers to Paramount stockholders both immediate value and future upside opportunity. The special committee, with the assistance of independent financial and legal advisors, conducted a thorough review of actionable potential transactions to drive value for our stockholders. In addition to economic value, the special committee took into account the certainty of closing and regulatory approvals. Following extensive negotiations with Skydance, we believe this proposed transaction will position Paramount for success in a rapidly evolving industry landscape. Upon closing, it will deliver immediate cash consideration at a premium to both the minority Class A and Class B stockholders, who will also benefit from what we believe to be considerable upside through continued equity participation in New Paramount.”
Phillips continued, “The special committee would like to thank our co-CEOs George Cheeks, Chris McCarthy and Brian Robbins for making significant progress on optimizing company operations in a short period of time, positioning Paramount for a sustainable transformation and a path to profitable growth going forward.”