Skydance claims rival Paramount bidder trying to ‘hijack’ deal proceedings with late offer
David Ellison’s Skydance Media has written a letter to the Federal Communications Commission (FCC) alleging that investment group Project Rise Partners (PRP) is attempting to “hijack” and delay the close of its US$8bn deal to acquired Paramount Global.
In September and then again in January, PRP sent letters to Paramount Global’s board of directors claiming it could make a US$13.5bn bid for the storied century-old studio.
At the time, the bids were dismissed as they were made after the close of the “go shop” period, which gave any potential rival bidders a window of time to lodge competing offers to acquire Paramount.
A group of New York City pension funds last month filed an investor lawsuit against Paramount Global alleging it failed to get the best price by refusing to consider PRP’s offer. Last week, Project Rise filed a “friend of the court” brief in a Delaware court, reiterating its desire to have Paramount’s board “formally consider PRP’s offer.”
The judge declined to issue an order to temporarily halt the US$8bn merger between Paramount Global and Skydance Media, but did set an accelerated schedule that would allow for a ruling on an injunction by April 7.
In a letter to the FCC, which is reviewing Skydance’s takeover of Paramount, Skydance said PRP was attempting to “hijack this Commission proceeding to buy time for litigation to proceed… in an effort to force Paramount’s board to consider Project Rise’s belated – and unserious – bid to acquire the company.”
The letter from Skydance’s lawyers took PRP to task for its managerial inexperience and the lack of detail on how it plans to finance its “unrealistic” bid.
“Skydance’s fully funded plan will infuse Paramount with additional capital and combine Skydance’s talented, American management team and storytelling prowess with Paramount’s venerated brands,” said Skydance. “By contrast, Project Rise has advanced an unfunded and unrealistic proposal backed by a leadership team without relevant experience.”
PRP had previously argued that the passive investment from China’s Tencent Holdings into the merged Skydance-Paramount could compromise national security and give the Chinese government influence over the proposed entity.
On that front, Skydance said the proposed transaction would “ensure that New Paramount is controlled solely by American citizens and entities – the Ellison Family and RedBird Capital Partners – which will hold all the voting shares and most of the equity in New Paramount. Any insinuation that a great and deeply patriotic American family, the Ellisons, will be swayed by Communist influences is offensive.”
Skydance also argued strenuously against PRP’s claim that its use of artificial intelligence would lead to job losses, and that Skydance had prematurely begun involving itself in issues related to Paramount management.
Skydance’s letter concludes by urging the FCC to “reject [PRP’s] call for a fishing expedition” and to proceed with rubber stamping the deal.
“Indeed, Commission approval of the applications is urgently needed to accelerate the infusion of capital that will result from the proposed transaction, and to enable the Skydance Consortium to implement important changes to Paramount and CBS,” said Skydance.
Outside of the squabble with PRP, the Skydance-Paramount deal also faces scrutiny on separate grounds from FCC chairman Brendan Carr, who was appointed to the post by US president Donald Trump.
In October, Trump filed a US$20bn lawsuit against Paramount-owned broadcast network CBS alleging that it misleadingly edited a 60 Minutes interview with former vice-president Kamala Harris in the lead up to the presidential election. The suit claimed that the way the interview was edited amounted to “partisan and unlawful acts of election and voter interference.”
While it had initially appeared that Paramount might look to settle out of court, CBS last week fired back by filing two motions to dismiss Trump’s lawsuit. In its filing, CBS claimed Trump’s lawsuit was an “affront to the First Amendment and is without basis in law or fact,” and that it “seek[s] to punish a news organisation for constitutionally protected editorial judgments they do not like.”
