Shari Redstone, chairman of Paramount Global, attends the Allen & Co. conference. Media and Technology Conference in Sun Valley, Idaho, Tuesday, July 11, 2023.
David A. Grogan | CNBC
Skydance Media is ready to move away from its offer The most vital global one unless it receives a firm commitment from controlling shareholder Shari Redstone, according to the latest offer from Apollo Global Management and Sony Pictures, according to a person familiar with the matter.
The exclusivity window for talks between David Ellison’s Skydance, backed by private equity firms RedBird Capital and KKR, and Paramount ends on Friday and will not be extended, people familiar with the matter told CNBC’s David Faber. Paramount shares surged following this report.
The consortium was waiting to hear from Paramount’s special committee on whether the panel would recommend Redstone its bid to take over the company. Now that Apollo and Sony have formally expressed interest in acquiring the company for approximately $26 billion, the Skydance group is looking to Redstone to confirm its commitment to the deal.
The Skydance consortium does not want to remain a pursuer to Apollo and Sony, one of the people said. However, depending on what Redstone says, Ellison may want to work with her, the second person added.
Spokesmen for Skydance, Redstone National Amusements and the Paramount select committee declined to comment Friday.
As CNBC previously reported, Apollo and Sony made their latest offer on Thursday. A special committee is currently considering the offer, the people said.
Under the latest Skydance deal on the table, Redstone could receive less than $2 billion for its controlling stake in Paramount, less than Skydance’s initial offer. According to CNBC, the consortium is bringing in additional capital to pay common Class B shareholders at a nearly 30% premium over the undistorted market price of about $11 per share. In total, Redstone and Skydance will contribute $3 billion, the huge majority of which will go to Class B shareholders, according to people familiar with the matter.
Some estimates put Skydance’s deal value at about $5 billion. Like Skydance’s offer, Apollo-Sony’s offer includes a control premium for Redstone, according to people familiar with the matter.
Redstone previously rejected Apollo’s offer in favor of exclusive talks with Skydance. As CNBC previously reported, Redstone preferred a deal that would keep Paramount together, as the Skydance offer would have done. The private equity firm will likely break up the company.
