Edgar Bronfman Jr. drops bid for Paramount
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Edgar Bronfman Jr. at the 2018 Tribeca Film Festival in New York City. Photo: Gary Gershoff/WireImage
Edgar Bronfman Jr., former Warner Music chair and heir to the Seagram alcohol fortune, has dropped his last-minute bid for Paramount's parent, National Amusements Inc., he confirmed in a statement to Axios.
Why it matters: Bronfman's last-minute bid had threatened to upend the $8 billion+ agreement between Paramount and Skydance Media.
What they're saying: "Tonight, our bidding group informed the special committee that we will be exiting the go-shop process," Bronfman said in a statement. "It was a privilege to have the opportunity to participate."
- "We continue to believe that Paramount Global is an extraordinary company, with an unrivaled collection of marquee brands, assets and people. While there may have been differences, we believe that everyone involved in the sale process is united in the belief that Paramount's best days are ahead," he added.
- "We congratulate the Skydance team and thank the special committee and the Redstone family for their engagement during the go-shop process."
Catch up quick: Bronfman Jr. submitted an initial $4.3 billion bid last Monday, just ahead of a looming deadline tied to a 45-day "go-shop" window established as part of Paramount's July agreement with Skydance.
- The special committee overseeing the sale process approved an extension to the go-shop window for Bronfman to raise more cash. He upped his bid to $6 billion late last week, adding an additional $1.7 billion in equity to his previous bid for the company.
Zoom in: Bronfman believed his bid was competitive, because it didn't include a $4.5 billion valuation for Skydance, that would have diluted Paramount shareholders.
- His initial bid didn't include any earn-outs for Class B shareholders. But his extended offer addressed the issue.
- Skydance, Paramount, Paramount's special committee and NAI did not comment.
Yes, but: It was unclear whether the money Bronfman planned to raise from an investor group of dozens was ever going to materialize in time for consideration, if at all.
- While Bronfman's investment group did include serious financiers such as Fortress Investment Group and BC Partners Credit, others were lesser-known entrepreneurs and family offices.
The big picture: In pulling his bid, Bronfman officially ends the process for Paramount, and a chaotic few weeks for Skydance and its financing partner RedBird Capital Partners, which committed $2 billion for the deal.
- Skydance was at one point considering legal options in its fight to maintain its agreement, sources told Axios.
- Late Monday evening, Paramount's Special Committee released a statement saying, "The "Go-Shop" period as defined in the Transaction Agreement with Skydance Media, LLC has concluded with respect to all parties."
Update: The story has been updated with the statement from Paramount's special committee.
