By Dawn Chmielewski and Anirban Sen
(Reuters) – Paramount Global is in talks to open its books to a consortium of Sony Pictures and buyout firm Apollo Global Management interested in acquiring the U.S. media company, people familiar with the matter said on Wednesday.
Advisers from both sides are discussing the terms of a confidentiality pact allowing the exchange of commercially sensitive information, the sources said. That would allow Apollo and Sony to consolidate their $26 billion bid and challenge a competing bid from David Ellison’s Skydance Media.
A special committee of Paramount’s board evaluating the company’s options let a period of exclusivity lapse during its discussions on the Skydance deal last week.
The sources requested anonymity because the matter is confidential and cautioned that there was no guarantee the negotiations would result in a deal.
A spokesperson for Paramount’s special committee declined to comment.
Sony Pictures Chairman Tony Vinciquerra first approached Paramount’s controlling shareholder Shari Redstone years ago to consider acquiring the Paramount Pictures movie studio, according to two sources familiar with the negotiations. At the time, Redstone was not interested in breaking up the company, one of the sources said.
Since then, Sony has expanded its entertainment business, which covers film, music and television production, as well as distribution and publishing.
Sony Pictures has more than 3,500 films in its library, including franchises such as “Jumanji,” “Resident Evil” and “James Bond.”
The combination with Paramount, home to “Star Trek,” “Top Gun” and “The Godfather,” would create a Hollywood studio with the box office clout of Universal Studios or Walt Disney Studios.
A tie-up between Sony and Paramount would give it a 20.5% share of the North American box office, according to Comscore’s market share analysis, based on 2023 ticket sales.
Skydance had proposed a complex transaction, in which it would pay about $2 billion to acquire the Redstone family’s holding company, National Amusements, which owns 77% of Paramount’s Class A voting stock.
Paramount would then acquire Skydance in an all-stock transaction worth approximately $5 billion. He then proposed a $3 billion deal that included a mix of stock buybacks and cash that could be used to pay down debt.
(Reporting by Dawn Chmielewski in Los Angeles and Anirban Sen in New York; editing by Jamie Freed)
