Paramount Global’s months-long M&A epic is not over yet.
On Monday (August 19), billionaire media mogul Edgar Bronfman Jr. made a $4.3 billion offer to acquire Shari Redstone’s National Amusements Inc., the majority shareholder of Paramount Global. diversity has confirmed.
Bronfman’s offer is an attempt to compete with the bid from David Ellison’s Skydance Media and its backers, who last month negotiated a binding deal worth more than $8 billion for NAI and Paramount Global, whose properties include CBS, Paramount Pictures, Showtime/MTV Entertainment Studios and Paramount Media Networks.
Bronfman’s offer has been submitted to the special committee appointed by Paramount Global’s board to evaluate M&A proposals, which is expected to review it on Wednesday. Representatives for NAI, Bronfman and Skydance declined to comment; representatives of the special committee of the Paramount board did not respond to a request for comment.
Bronfman’s offer for NAI was first reported in the Wall Street Journal.
Bronfman’s offer includes $2.4 billion for NAI (about $1.75 billion less debt), a $1.5 billion investment to pay off debt on Paramount’s balance sheet, and $400 million in compensation that Paramount would have to pay to the Skydance group if Paramount chooses Bronfman’s offer.
On July 7, Paramount Global and Skydance Media announced a two-part transaction that would result in Skydance acquiring Shari Redstone’s National Amusements Inc. and then merging it with Paramount. Under a “go-shop” provision in that agreement, Paramount Global has the right to seek a better offer within a 45-day window expiring at 11:59 p.m. ET on August 21.
Currently, Bronfman is chairman of Fubo, the sports-focused pay-TV streaming provider that won a legal battle over the sports-streaming joint Venu of Disney, Warner Bros. Discovery and Fox Corp. last week when a federal judge issued a preliminary injunction barring Venu from launching and sided with Fubo’s antitrust arguments. Bronfman was chairman and CEO of Warner Music Group from 2004 to 2012, stepping down after the company was acquired by Len Blavatnik’s Access Industries. Before WMG, he was CEO of Seagram before selling that company to Vivendi.
With the M&A drama still unresolved, Paramount is conducting significant layoffs amid falling revenues in its TV and film businesses. The company said it will cut 15% of its U.S. workforce — about 2,000 jobs — by the end of 2024 to reduce annual costs by $500 million. The job cuts will be mostly in the marketing and communications departments, while there will be some “alignment adjustments” in other areas, including legal, finance and other corporate functions, according to Chris McCarthy, head of Showtime/MTV Entertainment Studios and Paramount Media Networks and one of three co-CEOs of Paramount Global.
Skydance’s cost-cutting goals are even more ambitious. Jeff Shell, the former CEO of NBCUniversal who would become president of a combined Skydance-Paramount company, said Skydance is targeting annual cost synergies of at least $2 billion at Paramount.
