Hollywood Group - Billionaire film producer buys Paramount
Traditional Hollywood conglomerate Paramount gets new owner. In lengthy negotiations, film producer David Ellison eventually emerged as the winner. He and his partners will take over the acquisition for more than eight billion dollars.
At first glance, taking control of Paramount seemed simple due to its stock structure. More than three quarters of the voting shares belonged to the previous owner Shari Redstone. This would have theoretically sufficed to acquire only her stake. However, threats of lawsuits from many shareholders of non-voting shares loomed if they felt disadvantaged.
Complex Billion-dollar Deal
According to the announcement made by Paramount, Redstone will receive 2.4 billion dollars for her shares. Paramount will merge with Ellison's production company Skydance Media.
Additionally, Ellison, his family, and involved investors will bring an additional 4.5 billion dollars to buy out the shares of non-voting shareholders. Finally, they will pay an additional 1.5 billion dollars to pay off Paramount's debts.
The 41-year-old Ellison will become the new CEO of Paramount upon completion of the deal. His father is Larry Ellison, the billionaire founder of the software company Oracle.
Hollywood Stone with Problems
Paramount is one of the names that made Hollywood great. Classics like "The Godfather" - and more recently, blockbusters from the Mission: Impossible film series came from this studio. Skydance provided Paramount with money as a co-producer of the latest box office hit "Top Gun: Maverick".
However, Paramount has been struggling with problems for some time. The American TV broadcaster CBS, a long-standing reliable revenue source, has been affected by the general decline in advertising spending for TV and the loss of cable subscribers. Paramount+, the streaming service, suffered significant sign-up losses, but is far behind the industry leader Netflix in terms of user numbers. As a result, Paramount is sitting on a debt mountain of 14 billion dollars.
Paramount Statement
The acquisition of Paramount by film producer David Ellison and his partners will significantly impact the media landscape in the USA. This move is expected to impact Hollywood, particularly Hollywood giants like Paramount, known for producing iconic movies like "The Godfather" and recent blockbusters from the Mission: Impossible series. The merger with Skydance Media, Ellison's production company, will also impact Hollywood's partnership dynamics.
The news of this complex billion-dollar deal has sparked interest on the Internet, with people discussing the implications for the movie and television industries. Paramount's partnership with Skydance Media, which co-produced the latest box office hit "Top Gun: Maverick," is a testament to their collaboration and its potential to shape Hollywood's future.
The sale of Paramount to Ellison and his partners is not just about acquiring the company's voting shares but also about addressing the concerns of non-voting shareholders. The additional funds brought in by Ellison, his family, and involved investors will be used to buy out the shares of non-voting shareholders and pay off Paramount's debts, which amount to 14 billion dollars.
The acquisition of Paramount by Ellison is set to be a turning point for the company. As the new CEO of Paramount, Ellison, the 41-year-old son of billionaire Larry Ellison, the founder of the software company Oracle, will have a significant role to play in shaping the future of this Hollywood giant.
