Shari Redstone, the daughter of media mogul Sumner Redstone, recently made headlines for paying off a significant debt owed by her family business that controls Paramount. The nearly $200 million debt was settled last month, with Redstone using cash primarily provided by tech billionaire Larry Ellison.
Ellison, the co-founder of Oracle, played a key role in helping Redstone clear the debt, which was owed to creditors of National Amusements, the holding company that owns a majority stake in Paramount. The move comes as part of a larger deal involving Skydance, the Hollywood studio behind blockbuster franchises like “Top Gun” and “Mission Impossible.”
As part of the $8 billion deal, Skydance and its partners, including Redbird Capital Partners, agreed to pay $2.4 billion for the family’s stake in National Amusements, leading to a merger with Paramount. David Ellison, Larry’s son, will take the helm of the new company.
Redstone, who holds a 20% stake in National Amusements, is set to receive approximately $350 million from the sale. She decided to pay off the 2018 loan early, despite it not being due until May 2025, in order to address financial difficulties amid Paramount’s struggles with various business units.
The decision to settle the debt early was prompted by reports of a cash crunch faced by Redstone, with Paramount facing challenges across its operations, from CBS to cable networks like Comedy Central and Nickelodeon. National Amusements had previously sold real estate assets to make a $40 million debt payment earlier this year.
The deal with Skydance was finalized in July after several false starts, including higher offers from other potential suitors. The agreement raised questions about whether Redstone received a favorable deal and turned down better offers for Paramount shareholders.
Despite concerns raised by investors, the deal is set to proceed, with the merger expected to close early next year. Paramount’s stock price remains around $10, despite the potential benefits of the merged business. Skydance’s projected EBITDA is expected to increase significantly in 2025, driven by upcoming film releases.
While the deal has faced scrutiny, stakeholders are optimistic about the future of the merged business. Paramount’s revenue is forecasted to grow substantially in the coming years, with a focus on hitting projections beyond 2025. The deal has attracted attention from regulators, with calls for a closer review of Skydance’s finances before finalizing the merger.
