In a move that sounds like it could be part of a juicy plot in HBO’s popular series “Succession,” Paramount Global is planning to swap out CEO Bob Bakish with a group of current division heads on Monday, according to insiders. This big change on the chessboard is aimed at speeding up the company’s future, for better or worse.
It’s expected that Paramount will announce Bakish’s departure on Monday, just before revealing its earnings after the markets close.
This decision to replace Bakish as CEO comes as Paramount Global gets closer to sealing a merger deal with Skydance Media. With Bakish leaving, it’s unclear what the future holds for Paramount as its own company, which might push the merger deal forward.
Some major shareholders, like Gamco Investors, Ariel Investments, Matrix, and Aspen Sky Trust, have publicly criticized the merger deal, saying it doesn’t benefit regular shareholders. The Skydance offer would involve a lot of new shares, which could reduce the value for regular shareholders.
Meanwhile, Skydance is expected to pay around $2 billion to Shari Redstone, who owns 77% of the voting shares in Paramount, to buy her holding company National Amusements. This would be a big payday for Redstone, whose stake in the company is now worth less than $1 billion.
Many people at Paramount, including Bakish, have spoken out against the deal, saying it mostly benefits Redstone. “There’s no doubt I’d prefer no sale,” said Mario Gabelli, the Chairman and CEO of Gamco, in an interview with The New York Post earlier this month.
Shifting Powers: Paramount’s CEO Shake-Up and the Skydance Deal
Monday’s CEO drama at Paramount Global centers on a “majority of the minority” vote, giving minority shareholders a say in the Skydance deal.
This shift in approach aims to sway opponents and has boosted Paramount’s shares by 5%.
Removing CEO Bakish adds uncertainty, as the company lacks leadership and direction. Talks with Skydance are set to end soon, and a potential joint bid by Apollo Global and Sony looms if shareholders reject Skydance.
Regulators might scrutinize a deal involving foreign funding, especially with Sony’s non-U.S. status. Paramount also faces a critical renewal deal with U.S. cable giant Charter Communications, with Bakish’s departure complicating negotiations and influencing the company’s future value.
