Edgar Bronfman Jr., former CEO of Warner Music and Universal, has made an offer for a controlling stake in Paramount Global. If successful, his bid could keep Shari Redstone involved with the company. Bronfman is open to having Redstone, who is currently the non-executive chairman at Paramount, remain involved if the special committee accepts his consortium’s bid for National Amusements, the controlling shareholder.
To challenge Skydance Media for ownership of National Amusements, Bronfman has raised $6 billion. Both Bronfman’s bid and Skydance’s bid include buying out a percentage of Paramount Global common shareholders. Bronfman’s bid would give cash to about 20% of Class B holders, while Skydance would pay out about 50% of current Paramount common investors.
It is unclear which offer Redstone prefers. The special committee will determine if Bronfman’s offer is a superior proposal for shareholders by August 28. If they decide in favor of Bronfman, Skydance will have four days to match the offer. The entire process is expected to conclude by September 5.
Bronfman still has a few days to raise additional funds for a competing bid. The special committee extended the “go-shop” period by 15 days to review Bronfman’s initial bid. Former AOL CEO Jon Miller is part of Bronfman’s bid and is a close ally of Redstone, potentially giving her more control over a future Paramount Global if Bronfman’s deal goes through.
Redstone has not spoken with Miller about the bid. Although the Redstone and Bronfman families have some connections, Edgar Bronfman Jr. and Shari Redstone have not had many interactions. Skydance CEO David Ellison and Redstone have discussed the potential for her to stay as a shareholder in a combined Skydance-Paramount Global.
Redstone is taking a wait-and-see approach regarding her future involvement with Paramount Global, regardless of its ownership. Spokespeople for Redstone, Bronfman, the Paramount Global special committee, and Skydance declined to comment.
Bronfman has been gathering individuals interested in owning a piece of Paramount Global, including film producer Steven Paul and Patron co-founder John Paul DeJoria. His financing comes from various sources, which may raise regulatory concerns if too much of the money is from foreign entities. Having multiple financiers may also make Bronfman’s offer riskier than Skydance’s bid, which is backed by private equity firm RedBird Capital and Larry Ellison.
Skydance has demanded that the Paramount Global special committee stop negotiating with Bronfman and argues that the bid doesn’t meet the criteria for a superior proposal. However, the committee has extended the go-shop period without alerting Skydance, according to a letter from Skydance’s lawyers.
In conclusion, Edgar Bronfman Jr. has made a bid for a controlling stake in Paramount Global, potentially allowing Shari Redstone to remain involved with the company. However, Skydance Media has also made a bid, and the special committee will decide which offer is superior. The outcome of the bidding process will shape the future ownership and leadership of Paramount Global.
