Bronfman Shockingly Raises Paramount Takeover Bid to $6 Billion – You Won’t Believe It!

Ex-Seagram and Warner Music executive, Edgar Bronfman Jr., persists in his last-minute chase of Paramount Global, hiking his bid to $6 billion for the Redstone family’s investment company and their historic studio, as reported by two insiders who were not authorized to speak publicly on the matter.

The recent development in this tumultuous auction occurred on Wednesday when Paramount’s independent board members were deciding whether or not to entertain Bronfman’s proposal for the beleaguered firm which owns CBS, Comedy Central, Nickelodeon, Showtime, and its eponymous Hollywood movie studio.

This flurry of activity comes six weeks post Paramount’s approval of media executive David Ellison’s $8.4-billion, dual-stage takeover of National Amusements Inc., the Redstone family’s investment entity, and Paramount.

Bronfman is attempting to navigate a tricky situation created by a clause in Ellison’s Skydance Media deal, which was greenlit in early July by Paramount board members and primary shareholder Shari Redstone. This clause allowed a 45-day “go shop” period, aimed to encourage competing bidders to present “superior” proposals, as stated in a regulatory filing.

The Bronfman group’s initial $4.3-billion bid was introduced on the 43rd day.

Late Wednesday, Paramount’s independent directors’ special committee announced the extension of the go shop deadline to September 5. Now, the directors need to assess Bronfman’s proposal and examine the robustness of his investor group’s financial backing to decide whether to shift directions and pursue a deal with Bronfman instead of proceeding with Skydance.

The committee also declared that the go-shop window would now be closed for other potential participants.

On Thursday, Skydance’s legal team sent a blunt letter to Paramount’s special committee, accusing them of contravening the conditions of Skydance’s agreement to purchase National Amusements and Paramount, according to two individuals familiar with the letter who were not authorized to discuss it. Paramount declined to comment on the letter, which was initially reported by the Wall Street Journal.

Insiders familiar with the process said Bronfman, the 69-year-old billionaire successor of the Seagram liquor empire, is facing considerable challenges in his attempt to displace Ellison, the billionaire Larry Ellison’s son, who has invested part of his family’s wealth into Skydance’s bid for National Amusements and Paramount.

Bronfman has been working tirelessly behind the scenes for months to formulate a bid for National Amusements and Paramount. However, he fell short earlier this summer, leading Shari Redstone to accept Skydance’s improved offer for the entities in July.

Skydance’s bid still seems stronger than Bronfman’s.

Skydance’s proposal is almost $2.5 billion more than the raised Bronfman bid. Additionally, Ellison has a signed contract and matching rights for any competing bid, along with support from RedBird Capital Partners and his billionaire father.

Moreover, the Skydance proposition includes a crucial clause that helped it secure the Paramount board’s backing: $4.5 billion allocated to buy shares from Paramount investors, including the nonvoting Class B shareholders who wish to exit at $15 a share.

In his letter to Paramount special committee Chair Charles E. Phillips, Jr., Bronfman stated that his group intends to establish a fund to buy out some Class B shareholders.

The Wall Street Journal reported that the new bid allows some non-Redstone, nonvoting Paramount shareholders an option to sell for $16 a share.

Provision for Class B shareholders has been a significant issue. Paramount board members have striven to show that they have been fulfilling their fiduciary duty of safeguarding the interests of all shareholders, not just voting Class A shareholders, including the Redstone family, who own 77% of the controlling shares.

Some shareholders have voiced their dissatisfaction over Ellison’s phased deal, primarily his plan to merge his Santa Monica studio, Skydance, into Paramount. The deal assigns a valuation of $4.75 billion for Skydance, which co-owns some of Paramount’s most successful franchises, including “Top Gun: Maverick,” “Transformers,” “Mission: Impossible,” “Reacher,” and “Star Trek.”

Both Skydance’s and Bronfman’s proposals would acquire the Redstones’ National Amusements for $2.4 billion. After settling the firm’s debt, the family would walk away with approximately $1.75 billion.

Bronfman has been a key figure in Hollywood for many years.

He previously headed Universal Studios, then Warner Music, and is now the executive chairman of FuboTV. Last week, FuboTV won a significant court victory against Walt Disney Co., Warner Bros. Discovery, and Fox Corp. A federal judge in New York temporarily halted the launch of the companies’ joint venture to create a sports-centric streaming service called Venu, citing antitrust concerns.

Earlier this spring, Bronfman had difficulties assembling a bid with financing from Bain Capital, according to individuals familiar with the process but unauthorized to comment. Bain ultimately declined, leaving Bronfman without a firm offer during a critical auction period.

Though Redstone temporarily cooled on Skydance’s bid, her other suitors failed to substantiate their financing.

Bronfman started rallying a group of individual investors that includes former Fox and AOL executive Jon Miller; Atlas Comics investor Steven Paul; former “Mighty Ducks” actor Brock Pierce; and John Martin, the previous CFO of Time Warner.

The group hurried to assemble a proposal substantial enough to be considered by this week’s deadline.

“We believe Shari Redstone philosophically prefers the concept of merging with Skydance given [the Ellison family’s wealth and because] Skydance has no plans of breaking up the company (for now),” media analysts Ric Prentiss and Brent Penter of Raymond James wrote in a report this week.

But the 70-year-old tycoon maintains a friendly relationship with Bronfman, according to individuals familiar with the process. Both are members of prominent dynasties and the two mingle in similar New York media circles. Moreover, one of her longtime advisors, Miller, is a key member of the Bronfman investment group. Miller was a partner in Redstone’s boutique investment firm, Advancit Capital.

Even if Bronfman’s bid fails, the exercise could potentially aid in defending against shareholder lawsuits. Paramount can argue that the sales process was receptive to other bids.

Times staff writer Samantha Masunaga contributed to this report.