After a long road, it looked like this might be the week when a deal was struck to sell and merge Paramount Global, which controls the Star Trek franchise. However, there is a sticking point with the Skydance deal and a new set of bidders has emerged.
Waiting for Shari at Skydance
Even after the exclusive negotiating window ended with Skydance Media in early May, talks had continued with David Ellison’s company and RedBird Capital, the private equity firm backing the Skydance bid. Things were looking up after news broke over the weekend that Paramount Global’s special board committee overseeing deals recommended Skydance’s offer after reviewing the deal, which included offering regular shareholders (Class B) a 26% premium option on the shares Theirs. . While some media outlets jumped at the deal announcing the deal was done, it was still awaiting a key final decision from Shari Redstone, Paramount Global chairman and owner of the majority of the controlling (class A) shares. However, Tuesday’s annual shareholder meeting saw no announcement of a deal and, worse, an employee town hall event for the same day was postponed due to “continued speculation regarding potential M&A.” This event has been rescheduled for June 25, perhaps indicating an expected time when things will become clearer.
Although a deal with Skydance was always seen as Redstone’s most favored, there have been reports that she was “unhappy” with the latest versions of the deal, which also included a reduced bid for National Amusements, its holding company. . Redstone is also reported to be particularly concerned about shareholder lawsuits that could hit him personally, as the complicated Skydance deal would benefit more than other shareholders. According to industry newsletter Puck, which has had reliable insider information throughout this process, Redstone is now seeking a provision requiring approval of the deal by a majority of the other stockholders by vote. Redstone holds about 77% of the shares of Paramount Global B. She thinks this will protect her from lawsuits; after it postponed the Viacom and CBS reunion in 2019, the company ended up paying over $290 million in shareholder lawsuits. And according to Puck, the issue could be the “breaking point” for the Ellison/RedBird team, who are worried this vote could kill the deal.
It is possible that this could be resolved either by Redstone dropping this last-minute demand, or by SkyDance/Redbird indemnifying it for litigation and/or finding a way to secure the support of other class shareholders A. They’ve spent a lot of time creating what would be a very complicated deal with many steps, so it’s likely they’ll try to find a way. Before this new sticking point emerged, they were reportedly already drawing up plans for how Paramount Global would be managed, with Ellison taking over Paramount Pictures (merged with Skydance), RedBird partner (and former NBCUniversal CEO ) Jeff Shell takes over as CEO of Paramount. Global, and his RedBird partner (and former CNN president) Jeff Zucker steps in to head CBS. Those plans will now have to wait for Shari to make her decision.
David Ellison of Skydance at the premiere of Star Trek Beyond in 2016
Another bidder
Adding to the complication, a new bidder is now reported to have spoken to Redstone. Producer Steven Paul (known for Baby genius franchise) has assembled a group of investors to buy Redstone, offering more than Ellison. The group of deep-pocketed backers includes John Paul DeJoria, the billionaire co-founder of Patrón tequila and Paul Mitchell hair care products. In addition to offering more than Ellison, this deal would also not involve a merger, avoiding regulatory issues. However, it is unclear what plans this group has for Paramount Global. A number of other interested parties, including Sony/Apollo, would see Paramount Global split up, potentially turning Paramount into just one brand, while assets and even real estate would be sold to the highest bidders . One of the reported reasons why Redstone favored the Skydance deal is that it wouldn’t keep Paramount (and her family’s legacy) relatively intact.
Go alone?
There’s always the possibility that Redstone won’t get the deal he wants with any of the potential suitors and decides to go it alone. This would be a challenge for the company without the capital behind its media rivals and the burden of a large amount of debt. For their part, at Tuesday’s shareholder meeting, the new “Office of the CEO” (consisting of CBS’s George Cheeks, Paramount Pictures’ Brian Robbins and MTV’s Chris McCarthy) outlined a turnaround strategy that includes cutting $500 million in the absence of content. costs – likely to include thousands of layoffs – as well as seeking a joint venture agreement for Paramount+.
They outlined how the company will focus on “billion-dollar brands,” including Star Trek, which Robbins described as one of the “iconic properties” spanning film and television, noting how there will be a new Star Trek “coming soon”. ”
From the Paramount Global 2024 Shareholders’ Meeting
You can see Star Trek shown up and down during the presentation as a past and future “billion dollar brand” for Paramount.
From the Paramount Global 2024 Shareholders’ Meeting
During the webinar, Redstone touted the new management trio, admitting it was not a “traditional management structure” and said she was confident they would “take swift action” in “assessing value for all shareholders ours”. Shari also came out to support the trio earlier this month at the film’s premiere whether (See below).
Embed by Getty Images
In summary, the future of the company that holds the future of Star Trek in its hands is still in flux. As always, TrekMovie will report on the latest business news affecting the franchise.
Keep up with all corporate news that may affect Star Trek here at TrekMovie.com.