Paramount Global is reportedly considering dumping longtime CEO Bob Bakish and replacing him with a group of executives as the entertainment giant inches closer to a deal with Skydance Media.
Bakish, who has been privately critical of the company’s talks to merge with Skydance, would be replaced on an interim basis with an “Office of the CEO,” comprised of the company’s division heads, The Wall Street Journal reported Friday.
No decision has been made about Bakish’s future, however, and he may remain in place, but the speculation comes at a pivotal time for the conglomerate, which is controlled by media heiress Shari Redstone through her family business National Amusements.
Paramount — home to Showtime, CBS, MTV, movie studio Paramount Pictures and the streaming service Paramount+ — has been hammering out details for a merger with Skydance that it hopes to finalize next month, sources told CNBC.
But Redstone and some of the board members have “soured” on Bakish, The Journal said, adding that they have questioned whether the CEO pursued strategic opportunities for the company “aggressively enough,” including a potential sale of the Showtime channel.
Spokespeople for the Paramount Global special committee, Paramount Global, and Skydance declined to comment.
Bakish, who had been viewed as Redstone’s right hand, was named CEO of Viacom in 2016.
He was elevated to the top job after the daughter of the late Sumner Redstone merged the company with CBS in 2019.
Bakish’s critics pointed to Paramount’s eroding TV business, loss-making streaming business and debt-laden balance sheet.
The Journal said that Redstone has blamed Bakish for the company’s overall predicament and what she views as missed chances to strike sound deals.
People close to Redstone said the mogul was open to selling premium channel Showtime, home to “Billions,” Dexter” and “Yellowjackets,” but that Bakish turned down bids — even rejecting a $3 billion offer from former Showtime CEO David Nevins last year. Instead, Bakish folded Showtime and its content into Paramount+
Bakish supporters beg to differ, saying that the exec put the company on the map with streaming via its Paramount+ launch, acquisition of Pluto TV, an ad-supported TV streaming service, as well as maintaining CBS’s strong industry position, among other things.
Paramount’s market value has plunged to $8.4 billion from $25.3 billion in 2019.
Removing Bakish could add more chaos to an already turbulent time for Paramount as it explores the deal to merge with Skydance, run by David Ellison, son of Oracle co-founder Larry Ellison.
Paramount’s special committee, in charge of fielding offers, and Skydance are honing in on how to value Skydance’s assets, as well as how much equity to add to the company as part of a recapitalization, sources told CNBC Friday.
Privately-owned Skydance would be valued at $5 billion and merged with Paramount, sources told the outlet. The independent studio has produced blockbusters for Paramount like “Mission: Impossible — Dead Reckoning,” and “Top Gun: Maverick.
Ellison, along with private equity firms KKR and Redbird, plan to raise about $4.5 billion to $5 billion in new equity, the sources said.
Roughly $2 billion of the sum would be used to buy out Redstone and another substantial portion would be used to pay down debt, the sources said.
The two companies have engaged in exclusive talks that expire May 3, but Skydance is looking to get an extension because Paramount has been slow to provide data during due diligence, CNBC reported.
Should the companies pull off a merger, Ellison will be named CEO of Paramount Global and former NBCUniversal CEO Jeff Shell as president, CNBC said.
That doesn’t leave a future at the company for Bakish.
Skydance, meanwhile, is putting the full court press to get the deal done before the exclusivity window closes. Equity firm Apollo Global and Sony are reportedly waiting in the wings after discussing teaming up to buy out all of Paramount Global.
CNBC said that Paramount’s special committee hasn’t received “concrete details on that offer and isn’t viewing it as a competitive bid to Skydance’s interest.”
The committee does have details on Apollo’s initial $26 billion bid, which was rejected by Paramount’s board amid concerns about Apollo’s financing, The Post previously reported.
CNBC said Paramount’s committee preferred Skydance’s bid over Apollo’s in part because it offered shareholders future upside by keeping the company public with a cleaner balance sheet.
But Bakish has privately argued against the Skydance deal because it dilutes common shareholders, CNBC reported, citing anonymous sources familiar with the matter.
The Journal added that Bakish has quietly pursued other deal conversations, even as Redstone pushed forward with Skydance talks.
One such deal included a potential streaming partnership with NBCUniversal-parent Comcast, without keeping Redstone or the board in the loop, The Journal said.
Bakish and Comcast had discussed a potential joint venture between Paramount+ and Comcast’s streamer Peacock, The Journal reported in February.
Meanwhile, several shareholders — including Mario Gabelli whose firm through super voting shares and common Paramount stock is the second leading voting shareholder next to Redstone — are also hoping the Skydance deal collapses.
They argue that it gives Redstone a massive premium for Redstone’s controlling shares while leaving common shareholders out in the cold.
Under the terms of the Paramount-Skydance merger, nearly 50% of the company would be owned by Skydance and its private equity partners, CNBC reported April 5.
The rest of the firm would be owned by common shareholders, and the company would continue to trade publicly.
Gabelli told The Post that he’d rather see Paramount exit all deal talks.
“There’s no question I’d rather see no sale,” Gabelli told The Post two weeks ago, adding that he’d rather see Bakish stick to his turnaround strategy.
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