Paramount and Skydance Unite: Major Shifts Loom for CBS Sports

Big changes are coming to CBS Sports and parent company Paramount Global. But exactly what those shifts will be and when they will arrive are still critically unanswered questions.

National Amusements, the Shari Redstone family company that controls Paramount Global, said late Sunday that it has reached definite agreement on a merger deal with Skydance Media worth more than $8 billion. The pact marks the latest and the most dramatic turn in a highly watched, back-and-forth saga that has seen the parties previously near a deal, call it off, and now resurrect it in full—all in the span of about three months. 

The deal seeks to bring under one corporate umbrella a media company that has rights to the NFL, half of the men’s March Madness, several top college conferences, and golf’s Masters, among other assets, along with a fast-growing documentary unit behind such projects as the highly popular Kelce on Amazon Prime Video. 

Plenty to Work Out

The NFL is also an investor in Skydance Media. But it’s still only the beginning of what could be more than a year of additional steps to follow before the union is complete and its effects are truly understood. Among the upcoming issues still at play:

• There are three major steps to the complex overall transaction. Skydance Investor Group—composed of the billionaire Ellison family and RedBird Capital Partners—will pay $2.4 billion in cash for National Amusements. Paramount Global will then merge with Skydance for $4.5 billion in a cash-and-stock deal, while $1.5 billion in capital will also be added to Paramount’s balance sheet. The newly combined company is valued at about $28 billion.
• The agreement contains a 45-day “go-shop” period. Paramount’s board of directors now have this window in which they can “actively solicit” alternate bids for the company. Should Paramount receive another, superior offer and take it, Skydance will receive a $400 million breakup fee. 
• Regulatory approvals will likely take a while. Company officials are targeting a closing in the first half of 2025. But the last time a major U.S. broadcast network changed hands—NBC during Comcast’s ’11 acquisition of NBCUniversal—nearly 14 months elapsed between the initial announcement of the deal and approval from the Federal Communications Commission and Department of Justice. 
• Familiar faces will be leading the newly combined entity. The merged Paramount-Skydance will be overseen by David Ellison, Skydance founder, as chairman and CEO, and Jeff Shell, former NBCUniversal CEO, as president. Most recently, Shell has been chairman of RedBird Sports and Media. 
• Significant cost cuts are coming. Even before the deal closing, Paramount said in a company memo that it will move forward on actions such as “streamlining teams, eliminating duplicative functions, and reducing the size of our workforce.” In a call early Monday with investors, Shell said $2 billion in cost efficiencies have been identified, adding that “we’ve got to run these businesses in a different way” amid ongoing media disruption. 

What They’re Also Saying

As Ellison and Shell laid out to analysts a goal of being a “winner” in streaming, suggesting potential partnerships that would advance bundling already happening across the industry, the executives additionally said that sports will remain a key part of the merged company. 

“It’s a new Paramount, it’s not just a catchphrase,” Shell told investors. “We think it’s going to be a new day for these combined assets.”

Editors’ note: RedBird IMI is an investor in Front Office Sports.