Sony Decides Not to Pursue Paramount Global Acquisition

TapTechNews August 8th news, Sony Group's president, chief operating officer and chief financial officer Hiroki Totoki said on Wednesday that the company will not reconsider acquiring the film and television production giant Paramount Global. This marks the official end of Sony's acquisition plan for Paramount.

Previously, it was reported that Sony and private equity giant Apollo Global Management had intended to acquire Paramount for about $26 billion, but then it was rumored that Sony was reconsidering this plan.

Hiroki Totoki said at the Sony's first fiscal quarter earnings conference, acquiring the entire Paramount is not quite in line with our strategy, and said it may pose a considerable risk as it may not be suitable for the company's capital allocation structure.

Hiroki Totoki's remarks confirmed a report in the Nikkei on Tuesday that Sony has decided not to make a new offer to Paramount Global after the independent film studio Skydance Media reached an acquisition agreement with the media giant Paramount.

According to TapTechNews, Paramount is one of the oldest production companies in Hollywood and has household IPs such as SpongeBob SquarePants and The Godfather. Last month, Paramount Global announced that it will merge with Skydance Media. The merger will proceed in two steps. Skydance will first acquire National Amusements with $2.4 billion, which holds the controlling stake of the Redstone family in Paramount. Then Skydance will merge with Paramount and offer $4.5 billion in cash or stock to its shareholders and provide an additional $1.5 billion for Paramount's balance sheet. The value of the merged new company is about $280 billion.

Once the transaction is completed, Skydance's investor group will own 100% of the Class A voting shares and 69% of the outstanding Class B shares. At the same time, Skydance will gain control of Paramount and become the owner of Paramount's film and television studio, Paramount+, CBS, and cable TV channels such as Nickelodeon, MTV, and Comedy Central.

This marks the official end of the Redstone family's decades-long control over Paramount. Since the media giant Sumner Redstone first acquired the company in 1994, the Redstone family has been the controlling shareholder of Paramount. After Sumner's death in 2020, his daughter Sherry Redstone took over the company.