In a surprising development, Shari Redstone, Paramount Global’s controlling shareholder, received the fewest votes in the recent board election. The filing showed Redstone secured 32.2 million votes, the lowest among the six candidates.
Redstone also faced strong opposition, garnering more than 905,000 votes against her re-election. This outcome came at Paramount’s annual shareholder meeting held on Tuesday.
Restructuring Plan Unveiled
During the meeting, Paramount’s co-CEOs introduced a restructuring plan aimed at cutting $500 million in annual costs. The plan includes potential asset sales and exploring partnerships or joint ventures for its Paramount+ streaming service.
The company continues to struggle with declining traditional television revenue and has yet to see significant recovery in its streaming service.
Turbulent Negotiations with Skydance
For months, Paramount and independent studio Skydance Media have been negotiating a potential merger. Skydance CEO David Ellison recently adjusted his $2.5 billion offer for National Amusements to provide more cash to nonvoting shareholders. However, this reduced valuation did not sit well with Redstone, potentially opening the door for rival bidders.
The ongoing negotiations have led to various terms being proposed. Reports suggest Skydance has agreed to buy 77% of National Amusements and nearly 50% of Class B Paramount shares for $15 each, amounting to a deal valued at $8 billion.
Financial Rollercoaster
Amid these discussions, Shares of Paramount experienced fluctuations, gaining 7.3% on Thursday before ticking down by nearly 0.4% after hours.
Additionally, a special committee within Paramount reportedly cooled on Skydance’s revised offer, signaling imminent failure of the merger if no extension is expected.
A Possible Path Ahead?
This turbulent period is partly due to the financial strain on Paramount. The company faced over $1 billion in losses last year and lags behind rivals like Netflix and Disney+ with fewer than 20 million subscribers on Paramount+.
National Amusements and Shareholder Actions
The outcome of these events is still uncertain as National Amusements is set to hold shareholder meetings early next year to address these evolving dynamics.
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