Following the news Sunday night of Skydance Media’s $8 billion deal to take over Paramount Global, the current Paramount co-CEO troika of Brian Robbins, George Cheeks and Chris McCarthy issued a statement to staff that “until the transaction closes, it’s business as usual.”
The transaction isn’t expected to close until the first half of 2025 due to regulatory approvals.
While it’s still to be determined who from the triad continues on in the new Skydance-owned Paramount, what was made certain tonight was that Skydance Media‘s David Ellison will be the new chairman and CEO of the new conglom, with former NBCUniversal chief Jeff Shell acting as president.
In Paramount Global controlling shareholder Shari Redstone’s note to employees she spoke of the troika, saying, “I think we can all agree on their enormous contributions to this company,” while also explaining why the company went in the direction of a three-headed CEO while simultaneously being courted by Skydance.
“At the same time, as you know, our Board has focused on ensuring we are pursuing all opportunities to best position the Company for the future and maximize value creation for all shareholders,” said Redstone.
The troika added in their note to employees, “We will continue to operate as an independent company and move forward with the strategic plan we outlined at our town hall. This includes actions to modernize our organization by streamlining teams, eliminating duplicative functions and reducing the size of our workforce. We will also continue to explore opportunities to transform global streaming and optimize our asset mix by divesting some of our assets.”
Paramount Global has already held talks with partners who could potentially take a financial stake in Paramount+, in addition to prepping BET Media for a sale. Plans are afoot to achieve a half-billion in overhead savings.
The co-CEOs, as you can read below, also heralded the union of Skydance and Paramount Global combining “Skydance’s financial resources, deep operating experience, and cutting-edge technology with Paramount’s iconic IP, deep film and television library, proven hit-making capabilities, and linear and streaming platforms that reach millions of viewers.”
While much has been written about Paramount Global’s near-$15 billion in long-term debt, note that isn’t some sort of balloon payment due to next year. Wall Street has been hard on Paramount Global in regards to its future viability as a streamer with a pricey overhead, and that’s a challenge most major studios have faced as they’ve dipped their toes in the OTT business.
The Special Committee of Paramount’s Board of Directors has a 45-day go-shop period to assess other bids on the table, though tonight’s news surely indicates all winds are blowing in Skydance’s favor.
At the time of this post, Paramount Global shares were up +0.17% in after-hours trading to $11.83.
Here’s the note from the co-CEOs:
Hi Everyone,
Today marks an important milestone for Paramount, as we just announced a definitive agreement with Skydance Media. By combining Skydance with Paramount, we would build on our storied legacy to create an even stronger, next-generation media and technology leader, positioned to win in today’s rapidly transforming media landscape.
As Shari shared, we expect this transaction to close in the first half of 2025, since it’s subject to regulatory approvals and other steps necessary to complete the deal. The agreement also includes what’s called a “go-shop” provision, which means that the Special Committee of Paramount’s Board of Directors and its representatives will be permitted to actively solicit and evaluate alternative acquisition proposals for a 45-day period.
Until the transaction closes, it’s business as usual – we will continue to operate as an independent company and move forward with the strategic plan we outlined at our town hall. This includes actions to modernize our organization by streamlining teams, eliminating duplicative functions and reducing the size of our workforce. We will also continue to explore opportunities to transform global streaming and optimize our asset mix by divesting some of our assets.
We have been on a journey to transform Paramount for the future, and thanks to your hard work, Paramount brings tremendous value to this combination with Skydance. Paramount continues to be the home of invaluable IP that powers the best that entertainment has to offer to audiences around the world, and a vibrant creative culture. And, our assets are among the most compelling in the industry, including the number one US broadcast network with CBS and our leading free-to-air networks in the UK, Australia, Argentina, and Chile; iconic brands like Nickelodeon, MTV, BET, and Showtime; a top five SVOD service in the US with Paramount+; and a leading global free ad-supported streaming service in Pluto TV. And of course, Paramount Pictures continues to create genre-spanning films that deliver at the box office, most recently with A Quiet Place: Day One – the latest addition to our 100-year-old film library.
This transaction would combine Skydance’s financial resources, deep operating experience, and cutting-edge technology with Paramount’s iconic IP, deep film and television library, proven hit-making capabilities, and linear and streaming platforms that reach millions of viewers. And, we already know Paramount and Skydance, led by David Ellison, can achieve incredible results together, as evidenced by our strong, 15-year collaboration that has delivered highly successful films and franchises like Top Gun: Maverick and Mission: Impossible – Fallout.
The Paramount that we know today would not be possible without the leadership of Shari and the Redstone family. It is because of their vision and support over the many years that we are one of the leading global entertainment companies in the world, with the best team in the business. We would like to sincerely thank Shari and her entire family for their unwavering support and leadership. We would also like to thank our Board of Directors, who have helped guide us along the way. We appreciate all that they do on behalf of Paramount.
And most importantly, we want to thank all of you, our Paramount Global team, for all you have done and continue to do to drive Paramount to new heights.
We know you will have questions and we’ll share as much information as we can throughout this process. In the meantime, you can read more about the agreement in the press release here.
Thank you,
George, Chris and Brian