Sony Pictures and Apollo Global Management have made an offer to acquire Paramount Global for $26 billion, as reported by the Wall Street Journal. According to the media, the offer was made on Wednesday by Sony’s chief executive, Tony Vinciquerra, and Aaron Sobel, a partner at Apollo. Paramount’s shares rose 12% on the news. Sony and Apollo were in talks to decide the offer to be presented for the media giant.
A special committee of the Paramount board, created to evaluate offers for the company, has been holding exclusive deal talks with Skydance Media. That period of exclusivity ends on May 3, and a separate source familiar with the matter said the exclusivity period is unlikely to be extended, opening the doors to other bidders, reported Reuters.
Paramount has been struggling to recover from last year's months-long strikes by Hollywood writers and actors, a soft advertising market and cord-cutting in the United States that has eroded profit for its TV business. Its streaming service also widely trails rivals such as Netflix and Disney+ in subscriber numbers. Shares of Paramount have fallen more than 65% since then, losing more than $14 billion in market value. At May 1, with a closing price of $12.26, the company was valued at $7.67 billion, according to LSEG data.
Earlier this week, the company announced in its latest Earnings Call that Bob Bakish would leave his charge as CEO, being replaced by an Office of the CEO, consisting of three senior company executives: George Cheeks, President and CEO of CBS; Chris McCarthy, President and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, President and CEO of Paramount Pictures and Nickelodeon.
The potential acquisition would help Sony Pictures Entertainment grow its share of the North American box office. Sony Pictures earned $1.01 billion in U.S. and Canada box office revenue last year, compared with Paramount's $842.4 million, according to data from Comscore. Sony Pictures Entertainment, a unit of Tokyo-based Sony Group, encompasses movie and television production, acquisition and distribution, digital content creation and distribution, studio facility operation and the development of new entertainment products, services and technologies. The group has more than 3,500 movie titles and franchises such as "Jumanji", "Resident Evil" and “James Bond”.
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