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Ellison could take control of National Amusements with financing
from Skydance's existing investors, which include The Ellison
family, RedBird Capital Partners and Tencent, the source said,
confirming a report in the Wall Street Journal.
If successful, Ellison would pursue a second step to merge
Paramount Global with Skydance, the company behind such films as
"Top Gun: Maverick" and "Mission: Impossible -- Dead Reckoning
Part One."
Talks are in early stages and may not result in a deal, the
source cautioned.
Paramount frequently receives expressions of interest in
acquiring Paramount Pictures, the storied studio whose library
includes such classics as “Star Trek,” “The Godfather” and
“Indiana Jones,” sources have previously told Reuters.
Shari Redstone, whose family controls Paramount, has been
reluctant to part with one of Hollywood's most prestigious
studios.
However, the deterioration of the global entertainment business
has wiped out more than $16 billion in value from the media
company formed through the hard-fought reunion of CBS and Viacom
in 2019.
The company’s market capitalization was $9.4 billion on
Thursday-- less than the valuation of Viacom before the merger.
People close to Redstone say she believes the company as
“grossly undervalued,” and would consider a deal that “makes
sense.”
In December, a source told Reuters that Warner Bros Discovery
CEO David Zaslav and Paramount CEO Bob Bakish had met to discuss
a potential deal.
National Amusements directly or indirectly owns 77% of the
voting shares of Paramount. National Amusements also controls
CBS, cable networks Nickelodeon and Comedy Central and also owns
800 film screens in the U.S.
Paramount could be worth $38.8 billion and equity could be worth
about $38 per share if the firm's networks, production assets
and DTC business were sold individually, Citi had estimated on
Dec. 11 after news reports on sale interests.
National Amusements and Larry Ellison did not immediately
respond to Reuters requests for comment, while Paramount
declined comment.
(Reporting by Dawn Chmielewski in Los Angeles, Akash Sriram in
Bengaluru; Editing by Shailesh Kuber and David Gregorio)
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