Shari Redstone, Chairman of Paramount Global, attends the Allen & Co. Media and Technology Conference in Sun Valley, Idaho, on Tuesday, July 11, 2023.
David A. Grogan | DailyExpertNews
Skydance Media is prepared to abandon its offer Big global unless it gets a firm commitment from controlling shareholder Shari Redstone, following the latest bid from Apollo Global Management and Sony Pictures, according to a person familiar with the matter.
The exclusivity period for talks between David Ellison's Skydance, backed by private equity firms RedBird Capital and KKR, and Paramount ends Friday and will not be extended, people familiar with the matter told DailyExpertNews's David Faber. Paramount shares rose after the report.
The consortium has been awaiting word from Paramount's special committee on whether the panel will recommend its bid to acquire the company to Redstone. Now that Apollo and Sony have formally expressed interest in acquiring the company for approximately $26 billion, the Skydance group is looking for Redstone to reaffirm its commitment to the deal.
The Skydance consortium is reluctant to offer up a stalking horse for Apollo and Sony, one of the people said. Still, depending on what Redstone says, Ellison may be willing to work with her, a second person said.
Spokespeople for Skydance, Redstone's National Amusements and Paramount's special committee declined to comment Friday.
Apollo and Sony made their final bid on Thursday, DailyExpertNews previously reported. The special committee is currently considering the offer, the people said.
As part of Skydance's latest deal on the table, Redstone may take less than $2 billion for its majority stake in Paramount, which is lower than Skydance's original offer. The consortium is contributing additional capital to pay Class B common shareholders at a nearly 30% premium to the undisturbed trading price of about $11 per share, DailyExpertNews reports. In total, Redstone and Skydance would contribute $3 billion, with the vast majority going to Class B shareholders, according to people familiar with the matter.
Skydance's valuation as part of the deal remains around $5 billion, the people said. It is unclear whether the Apollo-Sony Redstone offer provides the same premium.
Redstone previously rejected an offer from Apollo in favor of exclusive talks with Skydance. Redstone has favored a deal that would keep Paramount together, as Skydance's offer would, DailyExpertNews previously reported. A private equity firm will likely split the company.