The removal of Paramount CEO Bob Bakish is being played by Redstone

Precise News

The decision to remove Bakish as CEO comes as Paramount Global closes in on a merger agreement with Skydance Media.
A number of large common shareholders, including Gamco Investors, Ariel Investments, Matrix and Aspen Sky Trust have publicly criticized the deal, arguing it destroys value for common shareholders.
The Skydance offer would include billions of new equity that would dilute common holders.
Redstone is now open to a so-called “majority of the minority” vote on the Skydance deal, according to a person familiar with her thinking.
Paramount Global shares jumped about 5% in premarket trading Monday.
Typically, Paramount Global shareholders, such as Gabelli, would compare an offer to the standalone company’s prospects — hence his comments about not seeing a sale at all.
But by removing Bakish, Redstone and the Paramount Global board are now throwing the status quo into chaos.
Meanwhile, Paramount has an important carriage renewal deal with U.S. cable company Charter Communications in the coming days.


Paramount Global plans to replace Chief Executive Officer Bob Bakish with a group of current division heads on Monday in a move that could easily be a plotline from HBO’s hit show “Succession.” This is a chessboard-altering move meant to accelerate the company’s future, one way or another.

According to people familiar with the situation, Paramount is anticipated to make the announcement of Bakish’s departure on Monday before disclosing earnings, which happens after the markets close.

With the Paramount Global and Skydance Media merger agreement drawing near, Bakish’s dismissal as CEO has been announced. His exit raises concerns about Paramount’s short-term viability as a stand-alone business, which may facilitate the negotiation of a merger deal.

Many significant common shareholders have openly opposed the deal, claiming it destroys value for common shareholders. These shareholders include Gamco Investors, Ariel Investments, Matrix, and Aspen Sky Trust. Due to the billions of new equity included in the Skydance offer, common holders would be diluted.

The CEO drama on Monday starts there.

A person familiar with Redstone’s thinking has revealed that she is now amenable to a so-called “majority of the minority” vote on the Skydance deal. Sunday’s development was first reported by Bloomberg and The Wall Street Journal.

That represents a major shift in the Skydance negotiations. The deal’s critics may now have some influence over the final result as minority shareholders will now have a say in whether the deal moves forward. Monday’s premarket trading saw a roughly 5% increase in Paramount Global shares.

Gabelli, one of the Paramount Global shareholders, typically compares an offer to the prospects of the standalone company, which is why he said he didn’t see a sale at all.

Redstone and the Paramount Global board, however, are currently upending the status quo by dismissing Bakish. The organization won’t have a leader or a well-defined plan for the future. Redstone might be attempting to destabilize the business in order to pressure common shareholders into selecting a sale.

The exclusivity negotiations with Skydance will conclude on May 3. Skydance was moving closer to valuation terms, according to CNBC last week, but it still needed a two-week exclusivity extension, which the special committee hadn’t yet given.

An official for National Amusements told CNBC in a statement that “National Amusements specifically requested that the Paramount board form a special committee to exercise their dependent judgment in considering a potential transaction with Skydance.”. “National Amusements is not a member of the committee, and we respect the committee’s decision-making process and final assessment of whether Paramount finds the Skydance deal to be a compelling transaction and should proceed with it. “.

Now that the majority of the minority vote has been cast, Skydance intends to improve its offer to attract more common holders, according to Bloomberg. If terms are changed sufficiently, it’s unclear if the company will be able to persuade regular investors to reconsider.

If investors do not want Skydance and do not have a workable non-sale option, a joint bid by the private equity firm Apollo Global and Sony could act as a white knight. Initial negotiations on a deal have taken place, according to a report published by The New York Times earlier this month.

Investors will hold off until the parties make a formal offer that includes information about who is providing the funding for the acquisition. Regulators might consider an Apollo and Sony acquisition to be riskier if foreign funding is involved. Also not in the US is Sony. s. -based business, which might raise issues with the Committee on Foreign Investment in the United States, which would probably be reviewing the agreement.

In the meantime, Paramount and U have a significant carriage renewal agreement. S. Soon, the cable company Charter Communications will be involved. Bakish has been engaged in extensive talks with Charter. The impact of his departure on those negotiations remains uncertain, and they will be crucial in determining the company’s future valuation.

scroll to top