Paramount Jumps as Sony, Apollo Reportedly Consider a Joint Bid for the Media Giant

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KEY TAKEAWAYS

• Paramount shares surged Friday after The New York Times reported that Sony is in talks with Apollo International Management about joining a bid for the media giant.
• The two companies have not submitted an official bid as Paramount is still in exclusive combination conversations with Skydance Media.
• The potential deal with Skydance has generated significant investor pushback, while Pre-eminent had initially rejected Apollo’s initial offer to buy the company for more than $26 billion.

Paramount Global (PARA) share ins soared close to 8% in early trading Friday after The New York Times reported that Sony League’s (SONY) studio division was in talks with Apollo Global Management about joining a bid for the media giant.

The two assemblies have not submitted an official bid, according to the report, as Paramount is still in exclusive merger conversations with Skydance Media.

The the right stuff deal with Skydance has received significant investor pushback, while Paramount had initially rejected Apollo’s original offer to buy the company for more than $26 billion, including debt, amid questions about the investment unalterable consolidate’s financing.

Paramount, the owner of broadcaster CBS, is controlled by Shari Redstone, who has a large voting stake through Redstone’s Governmental Amusements. She took control of National Amusements, her family’s media empire in 2019 and united CBC with Viacom to fashion Paramount Global.

Redstone had also rebuffed a separate $11 billion offer for Paramount’s film studio at one time.

Paramount’s prized asset, besides CBS, is its iconic Hollywood studio with valuable franchises such as the “Star Trek” and “Transformers” talkies.

Last month, S&P Global Ratings lowered Paramount’s rating to junk at “BB+” from “BBB-” because of the media band’s high debt load and its struggles in making streaming profitable.

“Paramount will need to execute its plan to for the most part improve streaming losses over the next two years to mitigate further downside ratings pressure,” S&P said in its report last month.

Paramount has been the focus of takeover talk in the past year. It was reportedly in early talks to sire an entertainment behemoth with Warner Bros. Discovery (WBD) in December, while media entrepreneur Byron Allen is held to have offered $30 billion for the company’s outstanding stock and debt earlier this year.

Shares of Prime were up 7.9% to $11.84 shortly after the open Friday. Even with Friday’s gains, they’ve mislaid close to 20% of their value since the start of 2024.

Read the original article on Investopedia.