Paramount Remains Committed to Streaming as Skydance Agrees Merger Deal

Tim Cross 08 July, 2024 

Following a protracted takeover saga, Paramount has finally agreed a deal with production business Skydance Media which will see the two merge, creating what the two companies are calling ‘New Paramount’.  The merged company, led by Skydance’s David Ellison as chairman and CEO and new president Jeff Shell, ex-CEO of NBCUniversal, plans to “enhance and reinvigorate marquee Paramount and CBS brands” according to the announcement. This includes commitment to Paramount’s streaming services Paramount+ and Pluto TV, whose futures had looked uncertain during various takeover discussions.

The deal will see Skydance IG, led by the Ellison Family and investment management firm RedBird IMI, invest over $8 billion in New Paramount. A large portion of this will be spent firstly on acquiring majority shareholder National Amusements, and then buying stock from other shareholders. The remainder will be used to pay down debt, recapitalise the balance sheet, and support strategic initiatives.

Monetising IP, embracing streaming

Across the various proposed deals with different potential acquirers, Paramount’s intellectual property was seen as the major prize. Through its studio division, Paramount owns a number of popular franchises including Mission:Impossible, Top Gun, Transformers, Star Trek, Indiana Jones, and The Terminator. For some of the rumoured deals, it was speculated that Paramount’s distribution arms might be sold off or shut down, opening up opportunities to license content to third-party distributors as an IP arms dealer.

Paramount’s IP is certainly key in this transaction, but Skydance sees Paramount’s distribution arm as a valuable part of the business too. The announcement says the transaction combines Skydance’s “financial resources, deep operating experience, and expertise in cutting-edge technology with Paramount’s iconic IP, deep film and television library, proven hit-making capabilities, and linear and streaming platforms that reach millions of viewers”.

Indeed from what Skydance has said, it sounds like the company plans to invest further in distribution, particularly on the streaming front. The company says Paramount’s “premier content platform” will be “enhanced and powered by best-in-class technology and modernised infrastructure, offering scalability and ingenuity focused on delivering content through wholly-owned DTC platforms of Paramount+ and Pluto, while enhancing CBS and Paramount’s linear networks”.

Skydance has already worked on a number of big Paramount franchises including Mission:Impossible, Top Gun, and Star Trek. And the production business believes its experience working across different media types, as well as its own production capabilities, will get more value out of Paramount’s properties.

For example, Skydance has an animation division headed up by John Lasseter, who directed Toy Story, A Bug’s Life, and Cars. Skydance says this will expand Paramount’s animation capabilities, while also creating consumer product opportunities in the long-term. It also has an interactive entertainment department which has developed console games based on Marvel, Star Wars, and The Walking Dead, which could be used to create games based on Paramount’s own IP.

“This is a defining and transformative time for our industry and the storytellers, content creators and financial stakeholders who are invested in the Paramount legacy and the longevity of the entertainment economy,” said David Ellison, who will be Paramount’s new CEO. “I am incredibly grateful to Shari Redstone and her family who have agreed to entrust us with the opportunity to lead Paramount. We are committed to energising the business and bolstering Paramount with contemporary technology, new leadership and a creative discipline that aims to enrich generations to come.”

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About the Author:

Tim Cross is Assistant Editor at VideoWeek.
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