Paramount Global (PARA) shares took another hit on Wednesday as Shari Redstone, the controlling force behind Paramount through her family’s holding company National Amusements (NAI), officially called off merger talks with Skydance Media. The news sent the stock down about 2% in early trading, following an 8% drop the day before.
According to reports from the Wall Street Journal, Redstone is now shifting her focus towards a potential sale of NAI rather than pursuing a merger with another company. Hollywood producer Steven Paul and media executive Edgar Bronfman Jr. have reportedly shown interest in acquiring NAI.
This unexpected turn of events comes after an independent special committee of Paramount’s board had recommended the economics of the Skydance deal following months of negotiations. The committee was scheduled to vote on the merger with Skydance on Tuesday afternoon, but the deal fell through.
In a statement, National Amusements expressed gratitude towards Skydance for their efforts in pursuing the transaction and stated that they will continue to explore opportunities to drive value for Paramount shareholders. Other interested parties in Paramount include Sony Pictures Entertainment, Apollo Global Management, Warner Bros. Discovery, Byron Allen, and more.
Skydance, known for collaborating with Paramount on popular film franchises like “Mission Impossible” and “Transformers,” had revised its offer multiple times, with the latest offer valued at $8 billion. The deal would have involved Skydance merging its studio business with Paramount’s and offering a cash injection to help reduce Paramount’s debt.
The departure of CEO Bob Bakish in April, reportedly due to disagreements over the Skydance deal, has left Paramount in a state of uncertainty. The company’s new leadership is focused on cutting costs, exploring asset sales, and forming partnerships to drive growth.
As Paramount navigates through this challenging period, shareholders and industry observers are closely watching to see how the company will adapt and position itself for the future. Stay tuned for more updates on this developing story.