Skydance is calling out a rival bidder for Paramount for allegedly attempting to derail the Hollywood studio’s merger with the media giant, claiming it has uncovered proof of “fraud” and “misrepresentation” in an $8.8 billion competing offer.
Rival investor consortium Project Rise Partners has allegedly “fraudulently misrepresented itself” to the Delaware Chancery Court, according to letters from Skydance’s legal team reviewed by The Post.
Counsel for Skydance included affidavits from Goldman Sachs and Aquarian Holdings in which they denied Project Rise’s claims that the firms were advisors and investors on the deal, respectively.
Project Rise “has no formal business relationships with any of those entities,” lawyers for Skydance claimed in their letters, adding that “just 72 hours into its investigation” into Project Rise and the pension fund claims, it uncovered the alleged fraud and with more “formal discovery” it will likely unearth more.
Skydance claimed that if Goldman and Aquarian are removed, all that remains is a “rag-tag consortium of small businesses masquerading as a group capable of supporting a multi-billion-dollar cash offer.”
A rep for Goldman declined to comment. Aquarian did not respond to requests for comment.
The letters were sent to lawyers for Project Rise and New York City’s public pension funds, which sued to block the Skydance merger deal, whose exclusive terms have prevented Paramount from considering Project Rise’s bid claiming to be worth $8.8 billion plus an additional $5 billion for restructuring of debt.
Lawyers for Project Rise and the New York City pension funds did not return requests for comment.
“The attack by Skydance is outrageous and an effort to deflect from the real issue here. Project Rise Partners’ offer is superior to Skydance’s and would greatly benefit shareholders,” Project Rise told The Capitol Forum.
when she made a key ruling last week.
“We have the financial commitments to complete a transaction with Paramount Global. As for Skydance’s specific allegations, we just received them, and we will be responding in detail shortly.”
On Monday, Skydance filed a letter to the Federal Communications Commission, which is reviewing the Skydance-Paramount merger, claiming Project Rise is “seeking to hijack” the regulatory review process to “buy time for litigation to proceed in the Delaware Court of Chancery, in an effort to force Paramount’s Board to consider Project Rise’s belated—and unserious—bid to acquire the company.”
The case is currently before Delaware Chancellor Kathaleen McCormick, who has expedited the trial to at least temporarily block Skydance’s $8 billion deal from closing.
The New York City pension funds alleged Skydance is buying media heiress Shari Redstone’s controlling stake in Paramount at a much higher premium than it is paying common stockholders and that common shareholders were left out of the process without a vote.
But lawyers for Skydance claim the judge did not have all the evidence when she made the ruling to expedite the trial last week, and said it will inform the court of a host of issues, including proof that Project Rise is not a “legitimate buyer with sufficient resources and relationships” to make good on its bid.
Lawyers for the David Ellison-led Skydance also claim that Project Rise’s bid appears to be linked to co-chair Daphna Ziman’s “attempt to delay the liquidation of her failed cable network, Cinemoi North America.”
Last November Ziman submitted a declaration to the bankruptcy court stating her plan to reorganize the company based on her move to “purchase Paramount Global” with funding from Moses Gross and Malka Equities, according to court papers reviewed by The Post.
But those statements were made to the bankruptcy court over two months after Paramount’s go-shop period expired, the letters said.
She was told three times by Paramount’s special committee that her bids were too late and as a result, Cinemoi filed for Chapter 7 liquidation instead, the letters said.
Skydance lawyers also addressed Edgar Bronfman Jr.’s much-publicized bid for Paramount, noting that the media veteran, who once ran Warner Music Group, didn’t demonstrate the financing to the special committee, which forced him to withdraw his proposal.
Skydance lawyers revealed an apparent connection between Bronfman and Ziman, citing that The Bronfman Group is an equity holder in Cinemoi.
Lawyers for Skydance said Project Rise’s “fraud is now risking instability and billions for Paramount and its stockholders.”
