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If Sony Pictures Entertainment and Apollo Global Management acquire Paramount Global, they have their sights set on big changes at the entertainment behemoth — namely, making it smaller.
The New York Times, citing unnamed sources familiar with the matter, reports that if Sony and private equity firm Apollo end up buying Paramount, they would break up the enterprise. The plan would include selling off some of its signature offerings, including CBS, MTV, and its streaming service, Paramount Plus, the people said.
Sony would reportedly absorb Paramount Pictures — the studio behind The Godfather, Top Gun, and Mean Girls, among others — into its business.
The two companies would initially run Paramount together, with Sony holding a majority stake and much of the control over the entity, and Apollo owning a minority stake that it would sell back to Sony or another outside firm down the line, according to the Times.
Read more: Warren Buffett lost ‘quite a bit of money’ selling Berkshire Hathaway’s stake in Paramount
Sony and Apollo turned up the heat on a potential acquisition of Paramount last week with a $26 billion cash offer over the weekend. Paramount’s board of directors officially set the negotiations into motion on Saturday, people familiar with the matter told the Times.
Paramount had previously been in talks with David Ellison’s Skydance, a Hollywood production company. It was reported last week, however, that Paramount wouldn’t extend its exclusive merger discussions with the company when it expired Friday. Skydance had proposed to pay more than $2 billion for National Amusements, Paramount’s parent, and have Ellison lead the merged entity.
The news of new talks with Sony and Apollo also came after former Paramount CEO Bob Bakish stepped down from the company. He led Viacom for 8 years and served as CEO of Paramount since the merger between Viacom and CBS closed in December 2019.
Bakish was replaced by an “office of the CEO” made up of three division heads at the company: CBS CEO George Cheeks; Chris McCarthy, the CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Paramount Pictures and Nickelodeon CEO Brian Robbins.