Paramount’s beaten down stock price ticked up Monday following speculation that Edgar Bronfman Jr. may jack up his already-sweetened offer even higher to win the bidding war for the struggling media giant.
The veteran media executive reportedly raised his bid to $6 billion for National Amusements and a minority stake in Paramount Global last week — after initially offering $4.3 billion — in the latest twist over the company’s future.
However, Bronfman “may very well increase his bid yet again,” CNBC’s David Faber said on “Squawk Box” on Monday.
Shares of Paramount — home to movie studio Paramount Pictures, CBS, MTV and Nickelodeon — rose 0.6%, to $11.40, in midday trading, despite questions surrounding the certainty of the mogul’s financing.
Bronfman is still working on obtaining final signatures for his finance packaging, though he has all the investors in place, Bloomberg reported on Saturday,
Bronfman’s eleventh-hour offer threatens to undo the proposed deal between Shari Redstone and tech scion David Ellison’s Skydance Media.
Now, the Paramount special committee must decide by Wednesday if Bronfman’s bid is superior and if it does, Skydance will have four business days to match it, according to reports.
As part of Bronfman’s offer, the heir to the Seagram’s liquor family fortune and former CEO of Warner Music Group has said he is open to keeping Redstone, whose family owns a 77% stake in National Amusements, involved in Paramount Global.
He also plans to partner with Apple and Amazon to improve Paramount’s streaming business, which centers on its Paramount+ streaming service, Bloomberg said.
Bronfman’s $6 billion bid includes $1.7 billion for a tender offer that would give non-Redstone, non-voting Paramount shareholders an option to cash out at a premium of $16 a share, according to reports.
That compares to Paramount’s agreement with Skydance, which has committed $4.3 billion to buy Class B shares, each for $15 cash.
Bronfman’s offer has ruffled feathers at Skydance, which accused Paramount’s special committee of directors of breaching the terms of its deal by extending the period when it can engage with other bidders for the company, The Wall Street Journal reported late last week.
The move follows protracted negotiations with Skydance and its boss Ellison, the 41-year-old son of billionaire Oracle co-founder Larry Ellison.
Ellison, who is getting the backing of his father to build a larger media empire by merging Skydance with Paramount, is also partnering with RedBird Capital to provide a $1.5 billion cash infusion to help the media giant pay down its debt.
