NEW YORK — Entertainment giant Paramount, owner of CBS and behind blockbuster films such as “Top Gun” and “The Godfather,” has agreed to a merger with Skydance, the companies said.
The new combined company is valued at approximately $28 billion.
“Given the changes in the industry, we want to strengthen Paramount for the future while ensuring content remains king,” said Shari Redstone, president of Paramount Global.
Redstone’s National Amusements owns more than three-quarters of Paramount’s voting stock, through the estate of her late father, Sumner Redstone, according to data firm FactSet. Shari Redstone struggled to maintain control of the company.
Based in Santa Monica, California, Skydance has helped produce some major Paramount hits 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, the founder of the software company Oracle. It quickly formed a production partnership with Paramount that same year.
David Ellison will become chairman and CEO of what is being called New Paramount. The deal still needs regulatory approval.
The merger comes at a tumultuous time for Paramount, which laid out a restructuring plan that includes major cost cuts at an annual shareholder meeting in early June. The company also saw a leadership change earlier this year.
Paramount has struggled in an evolving media landscape, especially as its traditional cable business has declined. To reach today’s growing streaming audience, the company launched Paramount+ in 2021, but losses and debt still piled up over time.
Sumner Redstone used National Amusements, his family’s movie theater chain, to build a vast media empire that included CBS and Viacom, which have merged and divorced a number of times over the years. Most recently, the companies joined forces again in 2019, reversing the split that was completed in 2006. The company, ViacomCBS, changed its name to Paramount Global in 2022.
Under Sumner Redstone’s leadership, Viacom became 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 Paramount offer 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 possible merger with Paramount. But by February, Warner had reportedly halted those talks.
