By Gary Symons
TLL Editor in Chief
Media tycoon Edgar Bronfman Jr. has dropped his $6 billion bid to acquire Paramount Global, as Skydance Media prepares to close on its own offer.
Bronfman had submitted a bid to acquire the global entertainment conglomerate with a consortium of investors. His submission came after Skydance had already come to a tentative agreement with the board of Paramount Global.
However, the board voted to put that deal on pause so they could consider the Bronfman offer under a 45-day ‘go-shop’ clause in the merger agreement with Skydance.
Bronfman originally offered a $4.3 billion bid for Paramount’s majority shareholder National Amusements, controlled by Shari Redstone. A few days later that offer was bumped up to $6 billion, but Paramount subsequently reported on Tuesday, August 27, that Bronfman had withdrawn that offer.
There has been no official statement on why the offer was withdrawn. The news agency Reuters has reported that Bronfman was unable to come up with the required equity after some of his investment partners pulled out of the deal at the last minute.
Bronfman addressed the situation with grace, saying he believes Paramount Global will continue to do great things after its presumed merger with Skydance Media.
“We continue to believe that Paramount Global is an extraordinary company, with an unrivalled collection of marquee brands, assets and people,” Bronfman said. “While there may have been differences, we believe that everyone involved in the sale process is united in the belief that Paramount’s best days are ahead.”
His failed bid paves the way for the original merger with Skydance, which values Paramount at $28bn.
That offer, announced in July, would see Skydance investing $8 billion into the new company as part of the merger. Skydance would then pay a further $2.4bn to buy Redstone’s holding company National Amusements, which holds nearly 80% of voting shares in Paramount.
The Skydance deal is expected to close in the first half of 2025, subject to regulatory approvals.
At stake is one of the oldest and largest media conglomerates in the world, including Paramount Pictures, CBS Entertainment Group, The CW, BET Media Group, Paramount Media Networks, the latter of which includes MTV, Nickelodeon, Comedy Central, CMT, and Showtime, as well as the streaming businesses of Paramount+ and Pluto TV, not to mention a variety of international properties.
From a licensing perspective, Paramount Global is among the largest licensors on the planet, with its huge library of entertainment brands. Any shift in ownership of the company will also impact hundreds or thousands of licensees and several licensing agencies.
Charles E. Phillips Jr., the chair of Paramount’s special committee, formed to analyze competing offers, issued his thanks to Bronfman, but also said the Skydance offer formed the best path for Paramount Global and its investors.
“We thank Mr Bronfman and his investor group for their interest and efforts,” said Phillips.
“Having thoroughly explored actionable opportunities for Paramount over nearly eight months, our special committee continues to believe that the transaction we have agreed with Skydance delivers immediate value and the potential for continued participation in value creation in a rapidly evolving industry landscape,” he added.