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Shari Redstone has agreed to sell Hollywood group Paramount to independent film studio Skydance in a deal that ends her family’s involvement in the company founded by her grandfather in 1936.
The merger, which values ​​the new company at $28 billion, marks the end of a tumultuous eight-month process in which Redstone held discussions with a number of potential suitors, including private equity group Apollo and Sony.
It comes just weeks after Redstone blocked an eleventh-hour deal with Skydance, run by billionaire David Ellison and backed by US private equity groups including RedBird.
The Paramount film studio, which produced classic cinema titles including The Godfather, Titanic, Chinatowon Raiders of the Lost Ark, from the Redstone family to the Ellison company. His father is Oracle co-founder Larry Ellison, one of the richest people in the world.
Under the terms of the deal, Skydance will invest about $8 billion in taking over Paramount, including paying $2.4 billion to buy out National Amusements, the Redstone company that controls the group behind brands including MTV and CBS. The deal is expected to close in the first half of 2025.
“As the industry changes, we want to strengthen Paramount for the future while ensuring that content remains king,” said Redstone. “We hope the Skydance transaction will allow Paramount to continue to succeed in this rapidly changing environment.”
Redstone controls Paramount through National Amusements, which owns about 10 percent of the company but holds nearly 80 percent of its voting rights.
Skydance, an independent studio founded by 41-year-old Ellison in 2010, has produced blockbusters including Top Gun: Maverick, Star Trek Into Darkness and Jack Reacher: Never Go Back
Although it took months to finalize the deal, Ellison and Redstone found common ground early in their discussions. Both had stubborn and demanding fathers — Sumner Redstone said more than once that his daughter would never run his company — and both loved the Paramount studio on Melrose Avenue in Hollywood, according to people close to the executives.
“I am incredibly grateful to Shari Redstone and her family for agreeing to give us the opportunity to lead Paramount,” said Ellison, who will become the group’s CEO and chairman.
After her father’s death in 2020, Redstone took over the company. It pushed the idea to challenge Netflix and other streaming services by launching Paramount+, which lost billions.
The future of Paramount+ will be one of the pressing questions facing Jeff Shell, the former NBC executive who will become president of the newly combined company.
With losses mounting last year, then-CEO Bob Bakish cut the company’s dividend, rattling investors and hitting Redstone’s own finances. She soon began exploring her strategic options.
During a messy, highly public process involving several competing bids, Bakish and four board members left the company amid disagreements with Redstone.
As part of the Sunday deal. Paramount’s advisers have 45 days to discuss competing offers for the company.
In the weeks since Skydance’s previous contract fell apart, other potential suitors have emerged, including media mogul Barry Diller and Edgar Bronfman Jr., the media executive and heir to the Seagram business. American private equity group Apollo, along with Sony, also offered to buy Paramount for $26 billion.
“Paramount’s recapitalization and combination with Skydance under the leadership of David Ellison will be an important moment in the entertainment industry at a time when incumbent media companies are increasingly challenged by technology intermediation,” said Gerry Cardinale, founder of RedBird and Ellison’s key partner in the company. trade.