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Skydance Media and Paramount Global agreed on Sunday to merge,
in a deal that would entail Skydance acquiring the Redstone
family's holding company, National Amusements, which owns a
controlling stake in Paramount.
Gabelli Funds, which owns nearly 4.9 million Class-A voting
shares in Paramount, is seeking greater transparency around the
National Amusements deal, according to another source at Gabelli.
It sent a letter to Paramount's general counsel on Friday,
requesting information, the source said.
"Operation fish bowl ... most likely starts today," Gabelli, the
82-year old chief executive of Gabelli Asset Management Company
Investors wrote on social media platform X.
Skydance Media and its deal partners plan to acquire National
Amusements for $2.4 billion in cash. In a related transaction,
the independent media company led by David Ellison would merge
with Paramount in an all-stock deal that values Skydance at
$4.75 billion, creating a company with an enterprise value of
$28 billion.
The companies have declined to disclose how much money Shari
Redstone would be paid for her Paramount shares compared to
other shareholders.
Skydance's deal to buy Redstone's National Amusements values the
holding company at $37.79 per Paramount share, and the Redstone
family stands to pocket $27.55 per Paramount share because of
$650 million in net debt.
This does not strip out some of the other assets that National
Amusements holds besides its Paramount stake, including movie
theaters and real estate. National operates 759 screens in the
U.S., UK and Latin America.
The parties have declined to provide sufficient information for
a direct comparison with the $23 that Class-A stockholders will
receive for each share and the $15 Class-B stockholders will
receive for each share.
National Amusements and Paramount did not immediately respond to
requests for comment.
Gabelli has privately said for months that the deal could be
harmful to investors and now appears to be laying the groundwork
to possibly challenge it in court.
Earlier this year, the Employees Retirement System of Rhode
Island, an investor in Paramount Global, asked for documents
related to talks between the company and Skydance.
Rhode Island argued that it wanted to be sure that the best
price is negotiated for Paramount.
(Reporting by Dawn Chmielewski in Los Angeles with additional
reporting by Svea Herbst-Bayliss in Providence; Editing by Rod
Nickel)
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