Paramount Global has officially set the date for its annual shareholder meeting on July 2, signaling that the long-awaited merger with Skydance Media may not close as anticipated. In various recent regulatory filings and communications, the company has consistently informed investors that the $8 billion deal is projected to finalize during the first half of 2025, which concludes on June 30. Given that Paramount is classified as a “controlled” company, the merger does not necessitate a shareholder vote, as the bulk of outstanding shares is owned by Non-Executive Chairwoman Shari Redstone and her family.
Paramount has provided specifics regarding the virtual shareholder meeting, which is scheduled for 9 a.m. ET on July 2. During this meeting, shareholders will have the opportunity to vote on the addition of three new members to the company’s board of directors. The nominees, put forth by the company’s board governance committee, include attorney Mary Boies, former judge Roanne Sragow Licht, and venture capitalist Charles Ryan. With the inclusion of these new members, the board will expand to a total of seven directors, which includes existing members Redstone, Barbara Byrne, Linda Griego, and Susan Schuman. Notably, the board had previously diminished to four members as some directors resigned during the merger discussions.
The primary obstacle for the Skydance transaction remains the approval from the Federal Communications Commission (FCC). This review process has been complicated by former President Donald Trump’s ongoing feud with CBS and the news magazine 60 Minutes. Trump has initiated a $20 billion lawsuit concerning the coverage of an interview with a Democratic presidential candidate. FCC Chair Brendan Carr, appointed by Trump, has emphasized that the commission's review of the merger is independent of the lawsuit. However, he has also indicated that the agency has not made significant progress in its evaluation of the deal.
The delay in the FCC's review process and Trump’s confrontational stance have caught the attention of many observers. Both Redstone and Larry Ellison, a key backer of Skydance, are known supporters of Trump, which adds an unexpected layer of complexity to the situation. Earlier this year, it appeared that the combination of Paramount and Skydance would be among several mergers forming in an industry that seemed poised for less stringent regulation. Instead, the negotiations have been stymied by Trump’s personal grievances against CBS.
After the annual meeting, a significant date to watch is July 7, which will initiate a second 90-day extension for the merger discussions, extending the timeline into October. Currently, Paramount is led by three co-CEOs: George Cheeks, Chris McCarthy, and Brian Robbins. This unusual leadership structure is intended to guide the company through the merger process. In a recent shareholder letter accompanying the amended proxy, the co-CEOs highlighted Paramount's achievements despite the numerous challenges and distractions faced. “In the midst of a dynamic and complex macro-economic climate, we are proud to declare that 2024 has been a transformative year for Paramount,” they stated.
There are still several merger-related shareholder actions pending in Delaware Chancery Court involving pension funds from New York and Rhode Island. One notable case, led by Mario Gabelli’s GAMECO—the largest holder of Class A stock after Shari Redstone—against National Amusements, was dismissed. Although the court has not granted an injunction to block the merger, there may be potential legal challenges from Class B shareholders once the deal is finalized. Class A shares hold super voting rights, giving Redstone nearly 80% control of the company, a structure established by her father, Sumner Redstone. The majority of publicly traded Paramount shareholders own Class B shares and have raised concerns throughout the Skydance negotiations, arguing that Redstone pursued the deal without their consent, securing disproportionate benefits for herself.
