In 2024, one of the world’s leaders in entertainment, Paramount Global, has already experienced a selection of major changes in the company. From laying off 800 employees in February to Bob Bakish’s immediate ousting at the end of April, the company has been undergoing restructuring and changes in leadership to combat the decline in traditional television and film businesses. June has proven to be no different for the entertainment company, which has seen the end of the Skydance merger saga and an update to the company’s co-CEOs’ pay packages.
For months, Paramount’s controlling shareholder, Shari Redstone, had been advocating for the company’s merger with David Ellison’s Skydance Media. The two entertainment companies had spent months in negotiations, with Skydance already having co-financed a number of film and television projects with Paramount Pictures. With M&A talks happening since last fall, Skydance Media became the first outside entity to break through as a solid candidate.
Paramount Global and Skydance Media had been in deep discussions on merging, with Redstone favoring the deal at one point, which would have paid her a premium and kept the businesses together, at least initially. The proposed transaction would have seen Paramount and Skydance merge, also calling for Skydance to acquire Redstone’s NAI, gaining official control of Paramount.
Yet, from the start, many Paramount Global stockholders disliked the Skydance deal, leading the company, backed by Larry Ellison and Gerry Cardinale’s RedBird Capital, to revise the deal several times in an attempt to persuade stockholders, but many remained resistant. However, Skydance’s efforts proved ineffective, with Redstone breaking off merger discussions, with the Redstone family trust reporting that NAI had “not been able to reach mutually acceptable terms regarding the potential transaction with Skydance Media for the acquisition of a controlling stake in NAI.”
After the end of the Paramount/Skydance saga was announced, Paramount Global’s Office of CEOs, which consists of George Cheeks, president and CEO of CBS; Chris McCarthy, president and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, president and Chief Executive Officer of Paramount Pictures and Nickelodeon, expressed their commitment to remaining focused on company growth and cost-cutting.
The co-CEOs wrote in an announcement: “While the Board will always remain open to exploring strategic alternatives that create value for shareholders, we continue to focus on executing the strategic plan we unveiled last week during the Annual Shareholder Meeting, which we are confident will set the stage for growth for Paramount.”
Prior to the merger’s dissolvent, the co-CEOs had received an updated pay package. The company updated the compensation plans for the three executives in separate SEC filings last Monday, detailing the executives’ contract changes.
The company’s board had designated the co-CEOs as participants in the Executive Change in Control Severance Protection Plan. Under this plan, established last November, each of the executives can qualify for a severance payment of twice their base pay if the company changes hands. In addition, they can also continue to receive benefits for 24 months after their departure. When they serve in the Office of the CEO, the three leaders are eligible for an annual cash bonus of $2.75 million, which would be prorated if a changing of hands happens in less than a year.
