Deadline hears that Edgar Bronfman, Jr. has made an offer for Paramount Global in a deal worth $4.3 billion, attempting to undo Par’s merger with Skydance.
Top Of The Mountain: David Ellison’s Skydance Taking Over Paramount After $8 Billion Investment
The offer is said to consist of a $2.4 billion payment to Shari Redstone for her family holding National Amusements, which controls Paramount Global through its majority of Class A voting shares. Some $1.5 billion would be injected into the company’s balance sheet to pay down some debt and ensure investment grade. Most of the rest would go towards a $400 million breakup fee to Skydance, Deadline understands.
The offer would not take out other Paramount shareholders, unlike the Skydance deal, which set $4.5 billion to buy out all Class A and a chunk of B shares at a nice premium. That number was sweetened several times over months of negotiations to make the deal more appealing to stockholders, who had threatened to sue. They had been incensed at a transaction that gave Redstone alone a big payday, as this latest offer seems to.
The Skydance deal also offered $2.4 billion to acquire National Amusements as well $1.5 billion of capital for the balance sheet. However, a second step would see Paramount acquire Skydance in an all-stock deal valued at $4.75 billion, which would dilute shareholders. The company would remain publicly traded in both cases.
The offer comes ahead of Wednesday night deadline that will see Par’s merger with Skydance become official if no “superior” offer has emerged. If a rival deal is considered worthy of following up, the agreement allows 15 days, then another 15 to explore it.
Shari Redstone has the last word on any deal.
PREVIOUSLY: We are hearing that Edgar Bronfman Jr.’s bid for Paramount Global could come as early as tonight ahead of an 11:59 ET deadline on Aug. 21. That’s when Par’s merger with Skydance will become official if no “superior” offer has emerged.
Back In Business: Skydance And Shari Redstone Reach Terms On New Merger Proposal For Paramount
Skydance and Paramount’s circa $8 billion combination announced in July included a 45-day go-shop period that can be extended twice in 15-day increments, which would kick in if the special committee of Par’s board of directors has another offer credible enough to explore further. It now appears on the cusp of a new entrant in former Seagram scion and entertainment executive at Vivendi Universal and Warner Music, who could declare as early as tonight, although it might slide into tomorrow.
The terms are not known, but Deadline hears that Bronfman’s bid no longer includes Roku among its backers. Fortress Investment Group is. If Paramount ultimately jilts Skydance, any new buyer would be on the hook for a $400 million breakup fee.
The Skydance transaction would see the David Ellison company acquire Shari Redstone’s controlling stake in Paramount as well as all Class A and some Class B shares, then have Paramount buy Skydance in an all-stock deal with the company remaining public.
Some sources tell Deadline, but we haven’t confirmed, that Paramount director Charles Phillips is a proponent of the Bronfman bid and has been helpful in seeking financiers to assist it. Phillips, who leads the board’s special committee in assessing bids, was reportedly instrumental in the previous Skydance offer going sour with Paramount Global in June before the two sides came together again. Phillips voted for the latest iteration of the Skydance deal.
David Ellison ’s company is backed by Oracle co-founder Larry Ellison and Gerry Cardinale’s RedBird Capital. Skydance would also get a look at any new offer to be taken up by the Par board’s special committee, which unanimously approved the Skydance merger on July 7. It also said then that “the company does not intend to disclose developments with respect to the go-shop process unless and until it determines such disclosure is appropriate or is otherwise required.” So it’s not clear if or what Paramount might officially disclose this week.
Reps for all parties involved either declined to comment or to respond to queries.
Edgar Bronfman Backers, More Details Emerge In Bid For Paramount That Seeks To Unseat Skydance
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