The non-binding expression of interest, sent in a letter this week, comes as Paramount approaches an agreed-upon Friday deadline for the expiration of an exclusive negotiating period with Skydance, a Hollywood studio run by tech scion David Ellison. Paramount has been in talks with Skydance for months, discussing a complicated transaction that would involve a merger and an investment from private equity firm Redbird Capital Partners.
The new, joint expression of interest would make Sony a significant majority and controlling shareholder and Apollo a minority shareholder. The proposed all-cash acquisition may appeal to Paramount shareholders who have come out against the Skydance deal over concerns it benefits the company’s controlling shareholder, Shari Redstone, at the expense of others.
Paramount declined to comment.
The proposed merger of Sony and Paramount would create a new powerhouse in Hollywood, uniting the studios behind the Spider Man and Mission: Impossible franchises. Sony executives have discussed operating the Paramount studio as a division of their broader empire, combining their marketing and distribution functions.
Foreign OwnershipOne looming question for both Apollo and Sony is the eventual fate of Paramount’s CBS broadcast network. Regulations restrict foreign ownership of broadcast networks, throwing up a potential roadblock for Sony Pictures, a division of Sony Group Corp. One possible remedy under consideration is to have Apollo hold the licence for the CBS broadcast network.It remains to be seen whether a bid from Sony and Apollo would be acceptable to Redstone, whose controlling stake would allow her to veto any deal.
