Paramount, Skydance Enter Merge Talks

Members of Paramount Global's board has agreed to enter into exclusive merger talks with Skydance Media, favoring the independent studio over a $26 billion offer from private equity firm Apollo Global Management, opens new tab, Reuters reports citing a person familiar with the matter.

The deal talks are more advanced than the offer from Apollo and if successful, would end Shari Redstone's control of the media empire built by her father, the late Sumner Redstone. The agreement grants Skydance 30 days of exclusive talks with Paramount.

A special committee of Paramount's board elected "to pursue the bird in hand," rather than chase a deal "that might not actually come to fruition," said the person with knowledge of the board's action.

A special committee of Paramount's independent directors has spent months in negotiations with Skydance, said the source, who added that the group's advisors, Centerview Partners and the law firm Cravath, Swaine & Moore, recommended the parties enter exclusive talks in an attempt to reach a deal.

Skydance is led by David Ellison, son of Oracle co-founder Larry Ellison, and is seeking to buy National Amusements, the Redstone family's holding company, which directly or indirectly owns about 77% of Paramount's voting class stock.

That sale is contingent upon Ellison's ability to merge Skydance and Paramount Global.

Apollo earlier this year bid $11 billion for the crown jewel among Paramount Global's media assets, its film studio. Paramount's enterprise value at the end of 2023 was about $22.5 billion.