Paramount Global, one of Hollywood’s oldest companies, has agreed to merge with the independent film studio Skydance Media. The merger marks a significant shift in the entertainment industry, valued at approximately $28 billion (£21.9 billion).
As part of the deal, Shari Redstone, Paramount’s non-executive chair, will sell her family’s controlling stake in the company. This complex transaction concludes an era for the Redstone family, whose late patriarch, Sumner Redstone, built a vast media empire from a chain of drive-in cinemas.
In addition to Paramount, the media group encompasses television networks such as CBS, Comedy Central, Nickelodeon, and MTV.
Shari Redstone expressed optimism about the merger, stating, “Our hope is that the Skydance transaction will enable Paramount’s continued success in this rapidly changing environment.”
Paramount’s TV channels boast a global reach of over 4.3 billion subscribers across more than 180 countries. The merger will combine Paramount, known for classic films like “Chinatown” and “Breakfast at Tiffany’s,” with Skydance, its financial partner on recent major releases such as “Top Gun: Maverick” and “Star Trek Into Darkness.”
Under the agreement, Skydance will invest around $8 billion in Paramount, including $2.4 billion for National Amusements, the firm that controls the group behind names such as CBS and MTV. Although National Amusements owns just 10% of Paramount Group’s shares, it accounts for nearly 80% of its voting rights. Paramount anticipates closing the deal by the summer of next year.
Paramount Global’s origins trace back over a century to the founding of Paramount Pictures Corporation in 1914. The studio has produced numerous hit films, including the “Godfather,” “Star Trek,” and “Mission: Impossible” series. However, the entertainment giant has faced challenges over the past decade, with its shares falling by more than 75% in the last five years.
Skydance is owned by David Ellison, son of Oracle founder Larry Ellison. The announcement follows eight months of negotiations, during which Redstone engaged with several potential partners, including Sony and private equity firm Apollo.
In April, Paramount’s chief executive Bob Bakish left the company after clashing with Ms. Redstone over the planned Skydance deal. The merger comes amid a transformative period for the global entertainment industry, driven by the video-streaming revolution.
Melissa Enoch
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