Paramount Global Receives $30 Billion Offer From Byron Allen
The Paramount Global soap opera just revealed its latest twist. Media mogul Byron Allen is making a $14.3 billion offer to acquire Paramount Global, in addition to assuming the nearly $15 billion in debt the company has amassed. He’s backed by bankers and other investors.
This is according to Bloomberg, which is reporting that the Allen Media Group is offering $28.58 per voting share (doubling the current market price) and $21.53 per non-voting share. The company confirmed the offer on the record with the following statement, which was met with a “no comment” response from Paramount Global’s reps:
“This $30 billion offer, which includes debt and equity, is the best solution for all of the Paramount Global shareholders, and the bid should be taken seriously and pursued.”
According to the report, Allen plans to sell Paramount Pictures, the studio lot, and IP rights, but would keep the TV stations and the streaming service Paramount Plus, which he would reorg to run on a “more cost-efficient basis”.
Paramount Global is a publicly traded company that is controlled by National Amusements Inc. (NAI), a private business owned by the Redstone family. Shari Redstone, head of NAI, doesn’t have a financial majority in Paramount (Warren Buffet does; Shari has a 10% financial stake) but she does have 80% of voting shares. Bob Bakish is CEO of Paramount Global.
So there are multiple ways in for someone who is targeting a piece of the pie that is Paramount. David Ellison, CEO of Skydance Media, is also contemplating multiple scenarios to buy the company. Puck News and Deadline reported late last year that they wanted to go in through acquiring National Amusements; The Wall Street Journal later reported that Ellison wants to make an all-cash offer for NAI, backed by several private equity partners, including RedBird capital and his own father, billionaire Larry Ellison. They are then aiming for a second deal to merge Paramount Pictures with Skydance.
Are these two scenarios incompatible? At first glance, not necessarily. Ellison’s ultimate goal seems to be to merge the Paramount studio with Skydance, and he would have probably sold off the linear TV networks and shut down the streaming service. With Byron Allen stepping in, the steps would be basically swapped. It then becomes a question of how much Ellison would have to pay for an Allen-controlled Paramount Pictures, and how much time it would take for that to happen if there is a previous buyer for the parent company.
Analysts seem convinced that Paramount Global will suffer a major organizational shakeup this year. At this point, it’s all a matter of when Shari Redstone is ready to sell her family empire. The company strategically leaked intel on a meeting between Bakish and Warner Bros. Discovery CEO David Zaslav late last year, to either entice other potential buyers, force Ellison’s hand, or simply check how the market would react to a merger with/sale to another big corporation. They got their answer: it reacted negatively, mostly because both companies are heavily invested in the declining linear TV business. It’s still too early to tell, but the market seems to have responded positively to the news about Allen.
Miguel Fernández is a Spanish student that has movies as his second passion in life. His favorite movie of all time is The Lord of the Rings, but he is also a huge Star Wars fan. However, fantasy movies are not his only cup of tea, as authors like Scorsese, Fincher, Kubrick or Hitchcock have been an obsession for him since he started to understand the language of filmmaking. He is that guy who will watch a black and white movie, just because it is in black and white.
