Skydance has been collaborating with private equity firms RedBird Capital Partners and KKR & Co. on a deal to acquire National Amusements, the holding company owned by Shari Redstone, which controls 77% of Paramount’s voting stock. However, this deal is dependent on merging Skydance with Paramount, and it is likely that the structure for a merger would involve a complete privatization of the larger media company, as mentioned by informed individuals. The potential sale is being considered by Redstone due to the shifting media landscape from traditional TV to streaming. Despite Paramount Global’s profitable business over the decades, it is relatively smaller than major streaming platforms like Netflix, Google’s YouTube, Apple, and Amazon, which have greater financial resources to afford sports and entertainment content. It is important to note that no acquisition is guaranteed, and negotiations may not reach a successful conclusion. It remains uncertain whether Redstone would seek a different premium for selling National Amusements compared to what the remaining shareholders of Paramount Global would receive. Acquiring Paramount, which has a market capitalization of $8.2 billion and around $15 billion of debt, would require Skydance to secure additional capital. This funding could potentially come from Skydance’s private equity partners and Larry Ellison, co-founder of Oracle and David Ellison’s father. Skydance has not yet pursued external financing as a decision on whether to proceed with the deal has not been made, according to sources. It has been indicated that Skydance is not interested in a deal that would involve acquiring only National Amusements without obtaining all of Paramount. While such a deal would grant Skydance control of Paramount, it would not address Paramount’s challenges as a publicly traded company, including managing the growing yet financially deficient Paramount+ streaming service and overseeing declining linear cable assets such as MTV, VH1, Comedy Central, and Nickelodeon. Spokespeople for RedBird, Skydance, Paramount Global, and National Amusements have declined to provide comments. Additionally, Warner Bros. Discovery has held initial discussions regarding acquiring Paramount Global, as per individuals familiar with the situation. If Redstone opts to sell to Skydance, one of the contributing factors would be her concern that Warner Bros. Discovery might prefer to merge with Comcast’s NBCUniversal, according to one of the sources. The initial reports on Skydance’s interest in acquiring National Amusements were made by Puck, and the Wall Street Journal previously reported that Skydance was considering a two-part deal involving the merger of Skydance and National Amusements. The initial exchange of company information was first reported by Bloomberg. It is important to note that Comcast NBCUniversal is the parent company of CNBC.
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