Paramount Owner Shari Redstone Ends Merger Talks with David Ellison’s Skydance

The unexpected development means there might be room for other Paramount bidders, including private equity giant Apollo and Sony Pictures.

Woman with blonde hair wearing navy jacket.
Shari Redstone has broken off merger discussions. Robyn Beck/AFP via Getty Images

In a surprising turn of events amid months of painstaking negotiations, Paramount (PARA) Global’s controlling shareholder Shari Redstone has put an end to a potential merger with Skydance Media. The move indicates a sudden change of heart from Redstone, who controls Paramount through its parent company National Amusements Inc. (NAI) and had advocated for her media and entertainment giant to be sold to the independent studio owned by David Ellison, son of Oracle co-founder Larry Ellison. National Amusements “have not been able to reach mutually acceptable terms regarding the potential transaction with Skydance Media for the acquisition of a controlling stake in NAI,” the holding company announced in a statement today (June 12).

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Redstone, the daughter of the late media tycoon Sumner Redstone, is walking away from a deal that would have seen National Amusements acquired for around $2 billion and Paramount merged into Ellison’s company. Skydance also was planning to inject $1.5 billion to help pay off Paramount’s debt and transition from cable to streaming. Redstone by all accounts was pushing for the merger between the two companies, which entered an exclusive negotiating window in April and continued to explore a deal afterwards.

A significant point of contention included Redstone’s desire that the deal be subject to approval from a majority of minority shareholders to avoid potential lawsuits. Redstone called off the deal yesterday (June 11) ahead of a committee meeting to vote on the merger, as the Wall Street Journal first reported. The report noted that Redstone will now likely pursue a sale of just National Amusements and drop merger talks.

The unexpected development means there might be room for other Paramount bidders who previously fell by the wayside due to Redstone’s preference for Skydance. Earlier this month, the private equity firm Apollo Global Management (APO) and Sony Pictures offered $26 billion for Paramount, while former media executive Edgar Bronfman Jr. and Hollywood producer Steven Paul are both reportedly interested in acquiring National Amusement.

A souring of relations between Redstone and Paramount’s former CEO Bob Bakish over his concerns regarding the Skydance deal reportedly led to Bakish’s ouster in April. He was then replaced by three executives making up an Office of the CEO. During Paramount’s annual shareholder meeting earlier this month, the co-CEOs outlined a plan that would explore potential asset sales, cut $500 million in costs and pursue partnerships for its streaming brand, Paramount+.

National Amusement “is grateful to Skydance for their months of work in pursuing this potential transaction and looks forward to the ongoing, successful production collaboration between Paramount and Skydance,” said the parent company, adding that it “supports the recently announced strategic plan being executed by Paramount’s Office of the CEO as well as their ongoing work and that of the Company’s Board of Directors to continue to explore opportunities to drive value creation for all Paramount shareholders.”

Paramount Owner Shari Redstone Ends Merger Talks with David Ellison’s Skydance