Who will buy Paramount?

[Moe]

@lowell See above - news about Skydance bought Paramount.

 

[Action!]

Now the question is: Is this the final merger deal.

 

[Daikun]

We have a deal????

Well, that's a surprise. I thought those merger talks broke down earlier.

 

[PF9]

If Skydance does the things I am asking them to do with MTV and Nick then that would sweeten the deal.

 

[harry580]

a lot of questions became running in like:
would skydance keep the movie theaters and that paramount owns the movie theaters as a answer to sony buying Alamo drafthouse, would showcase cinemas become a big chain again like they were 20 to 15 years ago?

 

[lowell]

@lowell See above - news about Skydance bought Paramount.

Actually, what's interesting in this is lawyers won't be ponied up if lawsuits are filed but the company is actually instead being given a "go-shop" period to get better offers:

"The deal would also give National Amusements a greater degree of protection against potential shareholder lawsuits over the deal. That had been a sticking point in earlier negotiations, given significant shareholder angst about the transaction.

The deal is expected to offer Paramount a 45-day “go shop” period in which it can talk to other suitors about a potential deal, three of the sources said. The billionaire Barry Diller and his digital media conglomerate, IAC, have expressed interest in National Amusements, as has Edgar Bronfman Jr., the media and finance executive, and Steven Paul, the Hollywood executive best known for his work on the “Baby Geniuses” franchise.

The Paramount board committee will now evaluate whether those new terms will be sufficiently palatable for shareholders."

Paramount and Skydance Near Merger Deal

Just weeks after the Paramount’s controlling shareholder and Skydance scuttled their talks about a potential deal, the two media companies have tentatively agreed to a merger.

www.nytimes.com

Given how many twists and turns there have been in this drama saga, it wouldn't surprise me if a bidding war happens at this point.

The goal is now likely refocused to selling the whole company for the highest price possible, though.

The Redstones, the board, and the non-Redstone shareholders would all stand to benefit from that.

But yeah, even with this news, nothing is guaranteed to happen at all so don't jump to conclusions on anything just yet.

 

[JulianRO]

Skydance reaches tentative deal to acquire Paramount for $1.75 billion

The deal would involve a purchase of National Amusements, then an immediate merger with the famed movie studio.

thedesk.net

 

[Daikun]

Excuse me... $1.75 billion?
That seems...awfully low, considering all the assets they own.

 

[Moe]

Excuse me... $1.75 billion?
That seems...awfully low, considering all the assets they own.

Yeah, it is and Disney paid whooping $70 billions for 20th Century.

 

[harry580]

please let redstone sell paramount to skydance already, I sick & tired of her saying yes but later say no to it

 

[lowell]

Excuse me... $1.75 billion?
That seems...awfully low, considering all the assets they own.

That's technically only for their family company, National Amusements.

The "go-shop" period will actually be looking for higher offers on both that and/or Paramount Global.

please let redstone sell paramount to skydance already, I sick & tired of her saying yes but later say no to it

Eh, it wouldn't be that surprising if the Redstones want to see a bidding war ignite over this at this point.

If they're bailing by cashing out and the non-Redstone shareholders want to cash out as well, they're going to look into maximizing the valuation as high as possible on the way out.

But yeah, again, nothing is guaranteed to happen at all so don't jump to conclusions on anything just yet.

 

[Elijah Abrams]

That's technically only for their family company, National Amusements.

The "go-shop" period will actually be looking for higher offers on both that and/or Paramount Global.

What’s the "go-shop" period?

 

[lowell]

What’s the "go-shop" period?

So, basically, at this point, the Redstones are actually opening a window where all types of offers can come in.

They are essentially serving as their own auctioneer at this point, looking for the highest bidder for either of the companies or even both of them if they can offload it all.

It's about making as much money as possible on their way out given the Redstones themselves, the board, and the non-Redstone shareholders all stand to benefit from that.

 

[Moe]

I do think that highest bidder for all of Paramount owned studios and libraries would be $20 billions, so average would be $10 to $15 billions.

Major studios aren't pleased to pay too much for libraries nowadays because return isn't impressive in streaming era, also their debt size grows with acquisition that make harder to pay off in long term.

 

[lowell]

I do think that highest bidder for all of Paramount owned studios and libraries would be $20 billions, so average would be $10 to $15 billions.

Major studios aren't pleased to pay too much for libraries nowadays because return isn't impressive in streaming era, also their debt size grows with acquisition that make harder to pay off in long term.

We'll definitely have to see what the ultimate number will be but in all sense, the Redstones, the board, and the non-Redstone shareholders will be walking away with their pots of gold at the end of the day.

 

[aegisrawks]

How about "No one"? Why is there such a DESPERATE NEED to constantly sell and buy corporations? What does this achieve?

 

[Silverstar]

How about "No one"? Why is there such a DESPERATE NEED to constantly sell and buy corporations? What does this achieve?

The answer is very simple:

Mo' money means a company gets to be a big fish, and when you're a big fish there's less chance of you being swallowed by a bigger fish. I agree these Hollywood playas have gone crazy with the nonstop Mergers and Acquisitions, but it's the hole they've all dug for themselves with good ol' fashioned naked greed. They're all in a mad scramble to stay on top. It's like playing Monopoly: whoever controls the most utilities wins.

 

[themidnightlore]

Honestly, Skydance as the options went is probably the less horrible pick. (Too bad that the Redstone family, while they do want to sell, somehow are incredibly picky?)

 

[Moe]

We'll definitely have to see what the ultimate number will be but in all sense, the Redstones, the board, and the non-Redstone shareholders will be walking away with their pots of gold at the end of the day.

I’m just saying that acquisition wouldn’t be lucrative as Disney bought $71 billions in 2019, despite about how big is Paramount with movie studios, cable channels, CBS, Paramount+ and Showtime.

 

[lowell]

How about "No one"? Why is there such a DESPERATE NEED to constantly sell and buy corporations? What does this achieve?

Given the Redstones have $200M of debt through National Amusements and have estate taxes, it's not surprising they're pushing for this to happen.

The answer is very simple:

View attachment 309078

Mo' money means a company gets to be a big fish, and when you're a big fish there's less chance of you being swallowed by a bigger fish. I agree these Hollywood playas have gone crazy with the nonstop Mergers and Acquisitions, but it's the hole they've all dug for themselves with good ol' fashioned naked greed. They're all in a mad scramble to stay on top. It's like playing Monopoly: whoever controls the most utilities wins.

There are two forms of answers to that question. This is definitely the simple one because if you're cashing out, you're going to milk as much as you can out of it on the way out.

The moment the Redstones sacked Bakish, it threw out the possibility of them continuing to stick around in the future.

The long-form answer is this is actually a result of the tech disruption in the industry.

The big picture is that Netflix played a disruptor role to 3 places.

Movie rental places got challenged by Netflix with their DVD-by-mail business, which of course, ended last year when the bulk of their customers are on their service now.

Entertainment companies who always traditional make films for theatrical releases and TV shows for networks was challenged by Netflix who started making exclusive films and shows specifically for streaming.

Cable companies were challenged by Netflix when customers start cutting the cord and went straight to a streaming platform to get their entertainment.

The further entry of Silicon Valley and Seattle entering into Hollywood further fueled the prevalent rise of streaming, which upends the longevity of all these traditional businesses in the first place.

If tech entrants are going to spend tenfold to wipe Old Hollywood out of the entertainment business, the veteran companies either have to evolve or migrate an exit before that moment happens.

This is why the Redstones are focused on getting the highest price possible on their exit sale of the company. They're more focused on securing the nest egg for their next of kin and also still have enough to retire from Hollywood after many decades.

The disruption to traditional Hollywood that we're seeing here is in the same vein Amazon disrupted traditional retail companies.

Now, many retailers are offering their own subscription service, free delivery options, and having Amazon pickup/return centers in their physical locations.

If you don't follow the changes of the times, it's easy to get left behind in the past and crumble in the future.

That's why the response to the disruption of tech entrants is needing to get shots in the arms to crucially compete and make sure the businesses can survive the ongoing changes in the real world.

This is why it's very crucial to understand the big picture when the news continues to report the ongoing technological innovations in the world because once that becomes the norm, you'll be seeing it impacting most aspects of our daily lives.

If streaming didn't happen at all, home media and linear networks would definitely still be king today.

The arrival of that technological catalyst brought the declines in theatrical, home media, and cable TV that we currently see, thus the need for adjustments to those changes.

Honestly, Skydance as the options went is probably the less horrible pick. (Too bad that the Redstone family, while they do want to sell, somehow are incredibly picky?)

The fact the Redstones fought for the go-shop period to happen shows they're way more interested in maximizing the valuation of the company as much as possible.


They'll walk away comfortably in every scenario but the goal is now focused on getting the highest price possible because the Redstones, the board, and the non-Redstone shareholders all stand to benefit from that.

I’m just saying that acquisition wouldn’t be lucrative as Disney bought $71 billions in 2019, despite about how big is Paramount with movie studios, cable channels, CBS, Paramount+ and Showtime.

It's definitely possible that will be true but like yeah, we haven't seen the ultimate number coming out of this so we'll see how that ends up.