NEW YORK — Entertainment giant Paramount, which owns CBS and is responsible for blockbuster films such as “Top Gun” and “The Godfather,” has agreed to merge with Skydance, the companies said.
The new combined company is valued at about $28 billion.
“Given the changes in the industry, we want to strengthen Paramount for the future while ensuring that content remains king,” said Shari Redstone, president of Paramount Global.
Redstone’s National Amusements owns more than three-quarters of Paramount’s Class A voting shares through the estate of his late father, Sumner Redstone, according to data firm FactSet. Shari Redstone fought to maintain control of the company.
Skydance, based in Santa Monica, California, has helped produce some big hits for Paramount in recent years. This includes several Tom Cruise films, including “Top Gun: Maverick” and episodes of the “Mission: Impossible” series.
Skydance was founded in 2010 by David Ellison, son of billionaire Larry Ellison, founder of software company Oracle. It quickly formed a production partnership with Paramount that same year.
David Ellison will be president and CEO of what is being called New Paramount. The deal still needs regulatory approval.
The on-and-off merger comes at a tumultuous time for Paramount, which at an annual shareholder meeting in early June laid out a restructuring plan that includes major cost cuts. The company also underwent a leadership change earlier this year.
Paramount has struggled in an evolving media landscape, especially as its traditional cable TV business has declined. To capture today’s growing streaming audience, the company launched Paramount+ in 2021but losses and debts still accumulated over time.
Sumner Redstone He used National Amusements, his family’s movie theater chain, to build a vast media empire that included CBS and Viacom, which merged and split several times over the years. More recently, the companies joined forces in 2019, undoing the split completed in 2006. The company, ViacomCBS, changed its name to Paramount Global in 2022.
Under Sumner Redstone’s leadership, Viacom has become one of the country’s media titans, home to pay TV channels MTV and Comedy Central and film studio Paramount Pictures.
Skydance wasn’t the only one to make a bid for Paramount in recent months — Apollo Global Management and Sony Pictures also made competing offers. At the end of last year, Warner Bros. Discovery also made headlines for exploring a potential merger with Paramount. But in February, Warner had supposedly interrupted these negotiations.
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