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Sony and Apollo Global Management have submitted a $26 billion cash bid for Paramount Global, according to sources, in a joint bid that escalates the bidding war for the entertainment giant.
Why it matters: The offer comes as an exclusive negotiating window for a complex rival offer for Paramount from Skydance Media closes on Friday.
Zoom in: Under terms of the joint bid, Sony would be the majority owner, with Apollo taking a minority stake in Paramount, sources told Axios.
- Axios previously reported on Apollo's pursuit of Paramount, including news of Apollo teaming up with Sony. Apollo and Sony officially submitting a joint bid raises their offer to the next level and news of it sent Paramount's shares soaring 13% on Thursday afternoon.
- The Wall Street Journal was first to report the submitted bid, saying it was sent on Wednesday and signed by Sony Pictures Chief Executive Tony Vinciquerra and Apollo partner Aaron Sobel, citing sources.
- Apollo previously submitted, on its own, a $26 billion cash bid for Paramount, as Skydance entered its exclusive talks. The private equity firm also offered $11 billion in an earlier bid for just Paramount's film and TV studio, a division that contains hits such as "Titanic" and "The Godfather" in its library.
Catch up quick: Paramount, which also owns CBS, MTV and Comedy Central, is controlled by National Amusements (NAI), the investment vehicle run by entertainment scion Shari Redstone.
- Shares in Paramount have fallen nearly 70% since Viacom and CBS merged to form the current company in late 2019.
- Late last year Skydance, a TV and film studio, emerged as a suitor Paramount, as Redstone finally believed it was time to pursue a deal. Skydance's CEO is David Ellison, the son of Oracle founder Larry Ellison. Skydance is an independent studio backed by KKR and RedBird Capital.
- In April, details emerged that Skydance would offer a cash premium to Redstone, and merge the two entities. Shareholders have revolted against the idea, saying it would enrich Redstone at their expense.
- Another stakeholder reportedly against the deal: Paramount CEO Bob Bakish, who stepped down this week, with sources saying it was partly due to his opposition to the Skydance deal.
Between the lines: In teaming together, Apollo and Sony feel confident there would be fewer regulatory concerns, one source said, given Apollo's ownership of local TV stations.
- Skydance is said to be willing to buy some Paramount Class B shares at a premium, with Redstone moving toward letting the non-voting shareholders have more of a say in the the deal.