Sony in talks with Apollo on joint Paramount bid
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Sony is considering joining up with Apollo Global Management on its bid to buy Paramount Global, Axios has confirmed.
Why it matters: Partnering with Sony could strengthen Apollo's pursuit of the company and add more pressure to the special committee mulling offers for Shari Redstone's media empire.
Zoom in: Sony executives including Sony Pictures CEO Tony Vinciquerra are currently talking with Apollo about the idea of teaming up, a source with knowledge of the discussions tells Axios.
- No offer can be made yet, as Paramount and Skydance are in their 30-day exclusive negotiating window to try and hammer out a deal.
- The New York Times, which first reported the Sony-Apollo talks Thursday night, said the bid would be an all-cash offer that would take the company private.
- One structure of the deal, per the New York Times, would see Sony take a majority stake in the company and Apollo hold a minority interest that it would have to right to sell to Sony at a future date.
- Paramount's stock jumped as much as 7% in premarket trade on Friday.
Catch up quick: Last month, Apollo offered $11 billion for just Paramount's film and TV studio. Earlier this month, it raised that to $26 billion for the entire company.
- A source familiar with the matter told Axios that what prompted Apollo's move to bid for the entire company was Paramount's debt getting cut to junk — a cut that would allow Apollo to roll over the company's debt into a deal. Apollo declined to comment.
- Paramount has signaled that even with an offer for the entire company, it prefers the more complex merger plan with Skydance for now.
- The deal talks with Skydance have led to significant investor pushback over concerns that the deal would leave shareholders in the cold.
The bottom line: Redstone's National Amusements owns 10% of Paramount's stock but controls the company via around 80% of Class A voting shares, so her say in whatever transaction emerges will go a long way.
