Bob Bakish, Paramount CEO, Steps Down as Company Weighs Merger – Generic English

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Looming over Mr. Bakish’s exit are broader questions about the future of Paramount. Like many media companies, Paramount has struggled in recent years to get its streaming business off the ground as audiences for its cable channels have diminished. As a result, it has long been considered an acquisition target by rivals looking to build up their content libraries and increase their leverage in cable negotiations.

In recent months, the company has been in discussions to merge with Skydance, a media company run by the tech scion and Hollywood executive David Ellison. Ms. Redstone, who is Paramount’s controlling shareholder, has already signed off on a potential deal for her stake, but the company’s directors have yet to reach an agreement for the whole company.

Several shareholders have come out publicly against a combination with Skydance, saying it would enrich Ms. Redstone at the expense of other investors. The private equity firm Apollo Global Management and Sony have discussed making an all-cash bid for Paramount, an offer that could give the company a serious alternative. But any talks with other suitors must wait until the exclusive negotiation period with Skydance lapses, in early May.

In an effort to assuage those concerns, Skydance sweetened its proposal in recent days. The company told Paramount that it would provide a $3 billion cash infusion to pay down debt and buy back shares, money that would come from the private-equity firm RedBird Capital and the Ellison family. Skydance also offered to give Paramount shareholders a larger stake in the combined company than it previously contemplated.

It is unclear if Skydance’s sweeteners will be enough to convince the special committee of board members evaluating the merger with Skydance that the deal treats all shareholders fairly. The rare nature of Mr. Bakish’s departure could put extra pressure on the committee to show it’s negotiating the best deal for shareholders, said Jim Woolery, founder of Woolery & Company, an advisory firm.

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