National Amusements has stopped talks with Skydance on a proposed merger with Paramount Global, CNBC’s David Faber reported Tuesday.
National Amusements, which is owned by Shari Redstone, the controlling shareholder of Paramount, had previously agreed to terms of a merger with a consortium that includes David Ellison’s Skydance, and private equity firms RedBird Capital and KKR. The deal had been awaiting signoff from Redstone, CNBC previously reported. National Amusements, which Redstone controls, owns 77% of class A Paramount shares.
Paramount shares closed nearly 8% lower Tuesday following the report.
National Amusements said in a statement on Tuesday it has “not been able to reach mutually acceptable terms regarding the potential transaction with Skydance Media for the acquisition of a controlling stake in NAI.”
“NAI is grateful to Skydance for their months of work in pursuing this potential transaction and looks forward to the ongoing, successful production collaboration between Paramount and Skydance,” the statement said.
Redstone’s company said it “supports the recently announced strategic plan being executed by Paramount’s Office of the CEO as well as their ongoing work and that of the Company’s Board of Directors to continue to explore opportunities to drive value creation for all Paramount shareholders.”
Paramount declined to comment. Spokespeople for Skydance and Redbird did not immediately respond to requests for comment.
The Wall Street Journal earlier reported talks had ended.
“While National Amusements had agreed to the economic terms that Skydance offered, there were other outstanding terms on which they could not come to agreement,” a NAI spokesperson said.
There’s been a disconnect on why the discussions didn’t amount to a deal, according to people familiar with the matter, showcasing the nature of the process that has gone on for months with various twists and turns.
The Special Committee of the Board of Directors of Paramount Global said, “The Special Committee met on Tuesday to discuss progress of discussions regarding a potential transaction with Skydance Media. At that time, the Special Committee was informed by a representative of National Amusements, Inc. that it did not have an agreement on a deal with Skydance Media and didn’t anticipate a path forward on this transaction. The Special Committee did not vote on any potential transaction.”
The about face on the proposed deal not only comes days after Skydance and Paramount agreed to merger terms, but also after Paramount’s annual shareholder meeting, where the company’s leadership outlined plans for the future.
Last week, Paramount’s current leadership, the so-called “Office of the CEO” — CBS CEO George Cheeks, Paramount Media Networks CEO Chris McCarthy and Paramount Pictures CEO Brian Robbins — mapped out the company’s strategic priorities in the event the company was not sold.
The shared leadership structure was put into place in late April, when former CEO Bob Bakish…
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