Paramount on Wednesday decided to extend its deadline to evaluate a takeover bid from media executive Edgar Bronfman Jr., the company said, a sign that it is taking the offer seriously.
The bid, submitted at the eleventh hour, could shake up the company's existing deal to be acquired by Skydance, an up-and-coming Hollywood studio. The USD8 billion deal with Skydance was reached after months of negotiations. That deal is backed by Larry Ellison, the Oracle founder whose son, David, runs Skydance.
"There can be no assurance this process will result in a superior proposal," the company said, adding that it "does not intend to disclose further developments unless and until it determines such disclosure is appropriate."
Bronfman and Skydance declined to comment.
Bronfman and his backers will now have until early September to convince a special committee of Paramount's board of directors that their offer is superior. Skydance also has the right to improve its bid to beat other suitors, which could further prolong the process.
Bronfman has assembled a group of investors that includes deep-pocketed private equity firms like Fortress Investment Group and a crypto kingpin who starred in a film from the "Mighty Ducks" franchise. Collectively, they have proposed to pay USD6 billion for a controlling stake in National Amusements, Paramount's parent company, along with a minority stake in the media conglomerate.
The Wall Street Journal earlier on Wednesday reported updated details of Bronfman's offer.
The bidding group also has ties to people associated with Shari Redstone, Paramount's crucial controlling shareholder. Jonathan Miller, who partnered with Redstone at an investment firm, is an adviser to the bid, according to people familiar with the arrangement, who would speak only anonymously because the discussions are private. Bronfman is also friendly with Redstone and met with her in recent weeks to discuss his bid, the people said.
This week, Bronfman and his allies have been working frenetically to persuade Paramount to take their bid seriously. The group secured commitments for additional financing in the past day, and met with Paramount on Tuesday to present their vision for the company.
So far, investors seem encouraged by having another bidder at the table. Mario Gabelli, an influential Paramount shareholder, posted on X on Tuesday that the company's special committee should extend the negotiation window with Bronfman, noting that there was little downside to continuing to bargain.
Bronfman's bidding group has some international ties, which may draw concerns from US regulators who oversee foreign investment, especially because Paramount owns the CBS broadcast network. Fortress, for example, is partly owned by Mubadala Investment Company, an Emirati sovereign wealth fund, though it is still controlled by Fortress management, which is based in the US.
The tug of war over Paramount has dragged on for months. In June, just as Paramount's special committee was preparing to vote on the Skydance deal, Redstone's lawyers scuttled the discussions. After a brief cooling-off period, the two sides continued negotiating and announced a deal a few weeks later.
Skydance would be a formidable rival in any bidding war. The company has access to nearly limitless capital through Ellison's family and existing business relationships with major entertainment powerhouses like Netflix and the National Football League.
But Bronfman is a veteran executive in his own right. The former chair of Warner Music Group, Bronfman is currently the chair of Fubo, the sports streaming service that recently sued to block the formation of a competitor from Disney, Fox and Warner Bros. Discovery. A federal judge issued a preliminary injunction in the case last week.