Skydance Media and Paramount Global‘s controlling shareholder are engaged in talks that could fold the home of CBS, Nickelodeon and Comedy Central into a new entity controlled by the people who produce starry Hollywood franchises such as “Mission Impossible” and “Tranformers.”
Shari Redstone, who controls Paramount’s corporate parent, National Amusements Inc., is in early discussions with a consortium of investors led by Skydance founder David Ellison,. (above, pictured), according to a person familiar with the matter. The talks may not come to fruition, this person cautions, but if they do, the investors would purchase a controlling stake in National Amusements that they would subsequently use to merge Skydance with Paramount Global.
Representatives for Skydance did not respond to a query seeking comment. National Amusements and Paramount declined to comment. Skydance has for several years produced many of the biggest films released by Paramount’s movie studio, including “Top Gun: Maverick” and “Transformers: Rise of the Beasts.”
The Wall Street Journal previously reported that the companies were engaged in discussions.
The deal would seem poised to effectively end the Redstone family’s direct control of Paramount and its many media assets, which also include the Showtime cable network, MTV and CBS News. Paramount has seen its fortunes ebb since being created out of the merger of the former CBS Corp and the former Viacom Inc.
The company’s Paramount studio has been in turnaround mode for several years and some of its top cable networks have been starved of fresh content for a similar period of time. MTV and Comedy Central, for example, largely subsist on marathons of repeats punctuated by an occasional original. Paramount’s position has grown weaker amid the rise of streaming video, which has pulled viewers away from top media vehicles like CBS.
Still, Paramount has assets that any media investor would covet. It has lucrative sports rights deals with the NFL and the NCAA, and boasts a roster of late-night programs that continue to win attractive audiences. Nickelodeon remains a popular kids’ destination, and young viewers’ media habits have proven a deciding factor in what streaming outlets consumers choose. Warner Bros. Discovery has also expressed interest in acquiring Paramount assets, according to people familiar with the situation, but that company, weighed down with billions of dollars in debt, could find such a task a complex one to accomplish.
A Skydance transaction could also prove difficult. Paramount Global has a dual-stock structure that would require significant capital, and the Skydance group has yet to do its due diligence on the state of Paramount’s operations, the person familiar with the matter cautioned. It remains possible that the Skydance investors could walk away from a deal.
Paramount Global has spent decades being managed by the Redstone family — largely Sumner Redstone, Shari’s father. Under his guidance, CBS and Viacom were merged and then separated, the last in the belief that CBS’ traditional broadcast assets would grow more slowly than Viacom’s cable properties. But Viacom, which gained traction among young audiences with cable concepts like MTV and TV Land, began to stumble as coveted viewers between 18 and 24 shifted to digital-media consumption.