Paramount’s special committee has been reviewing Edgar Bronfman Jr.’s competing bid to purchase National Amusements and take control of Paramount and is at least curious to see what it finds.
According to the Wall Street Journal, Paramount has extended the “go-shop period” during which other interested bidders could try to match or beat the deal agreed to with David Ellison’s Skydance. The committee had the responsibility to consider anything that “could or would result in a better offer” than what Skydance put on the table. That means the committee is now seriously considering the competing offer and will keep this M&A saga going a little longer.
After Paramount agreed to a deal with David Ellison’s Skydance, the company opened a 45-day window for others to follow suit. Late Monday, Bronfman formally submitted a $4.3 billion bid, saying his offer was “far more valuable” than Ellison’s, avoided the risks and costs of a Paramount-Skydance merger and offered a better deal for the average shareholder than just Shari Redstone.
Shortly before the news of the contract extension became known, Bronfman sweetened his deal: $6 billion.
That’s still less than the $8 billion Ellison is raising. But Ellison’s deal requires Paramount to buy his company in an all-stock transaction, which Bronfman said dilutes value for shareholders, leading some observers to criticize it as a favor deal for Redstone.
The Special Committee seemed to at least want to consider this proposal and extended the “go-shop period” by 15 days.
Representatives for Bronfman declined to comment. Representatives for Paramount’s special committee and Paramount did not respond to IndieWire’s request for comment.
Bronfman is the heir to the Seagram fortune and chairman of Fubo. He is also a former media executive and head of Warner Music Group. His bid brings together 19 different backers, including “Baby Geniuses” producer Steven Paul, former Turner CEO John Martin and child actor and crypto investor Brock Pierce, to name a few.
As originally reported by the Wall Street Journal, Bronfman believes he has identified $3 billion in cost savings at Paramount, while Skydance expects $2 billion worth of savings. It is expected that his plan could result in Paramount selling off key assets, possibly killing Paramount+ and getting out of the streaming business altogether, turning Paramount into an arms dealer for other streamers.
Ellison will, of course, have the opportunity to embellish his offering, and he probably has the financial clout to do so, considering his father is Oracle co-founder Larry Ellison.
