Even after clinching a deal with Skydance Media, Paramount Global has the right to shop around for a better offer in a 45-day window. But if Paramount agrees to accept a more attractive buyout deal, it would be on the hook to pay Skydance a $400 million breakup fee, David Ellison, founder and CEO of Skydance, told investors on a call Monday morning.
Under agreement with Skydance and financial backer RedBird Capital Partners, the special committee of Paramount’s board of directors has a 45-day go-shop period during which it will be permitted to “actively solicit and evaluate alternative acquisition proposals.” According to Paramount, it “does not intend to disclose developments with respect to the go-shop process unless and until it determines such disclosure is appropriate or is otherwise required.”
Also on the call Monday, Jeff Shell, chairman of RedBird Sports & Media and former CEO of NBCUniversal, said the Skydance team has identified more than $2 billion in cost-savings annually, including more than $1 billion in the first year.
Under the two-step Skydance-Paramount deal, Skydance will acquire Redstone’s National Amusements Inc., which holds a 77% controlling stake in Paramount; subsequently, Skydance will merge with Paramount Global. Once those transactions close, the management team of “New Paramount” will comprise Skydance chief David Ellison as chairman and CEO and ex-NBCUniversal chief Jeff Shell as president. The Ellison family and its financial partner, RedBird Capital Partners, said they will invest up to $6 billion into the “New Paramount.”
Source Agencies
