Skydance Takes Over Paramount+ and Pluto TV in Major Media Deal

Paramount Global has agreed to merge with Skydance Media. This deal will “fortify” the Paramount+ and Pluto TV streaming services with “best-in-class” technology and an increased cashflow. Both companies expect the merger to be completed by mid 2025.

Despite its strong presence in the media industry, Paramount’s balance sheet has grown increasingly bleak. Paramount only makes money on old-fashioned television and cable. It barely breaks even at the box office, and its streaming ventures are a consistent source of losses. As of September 2023, Paramount was $15 billion in debt and had just $1.8 billion cash on hand.

Drastic times call for drastic measures. National Amusements, the owner of Paramount and its subsidiaries, has publicly floundered as it attempts to fix this mess. It pursued strategic partnerships with Comcast and WDB , it kicked hundreds of employees to the curb, and it briefly stuck a “for-sale” sign on BET . The merger with Skydance has been an on-again off-again affair, but it’s now written in legal ink .

We won’t see the effects of this deal for some time. However, Skydance Media founder David Ellison insists that he will build a “new Paramount” that is capable of meeting “the demands of the evolving marketplace.” Paramount will receive an $8 billion cash injection, and an additional sum of money will be put toward Paramount’s debt.

The merger should also provide $2 billion in savings after restructuring and integration. And because Skydance has served as Paramount’s financial partner for films like ‘Top Gun: Maverick’, the studio may now have a more consistent source of funding for big-budget films.

While increased cashflow should be a windfall for Paramount+ and Pluto TV, there’s a decent chance that Skydance will sell off some of Paramount’s assets. Paramount has repeatedly expressed interest in shedding networks like BET and MTV, though Skydance hasn’t revealed how it will handle these properties. Most corporations that negotiated with National Amusements wanted to sell Paramount for parts .

For reference, Skydance doesn’t really own any IP, though it has funded several films and TV shows that could find their way to Paramount+. Large investments from Skydance may also be used to fuel sports streaming on Paramount+, as sports programming is generally understood to be the “final frontier” for the so-called streaming wars.

This merger appears to be set in stone. Both parties seem confident that everything will be settled by mid 2025. However, Paramount has a 45-day “go-shop” period in which it may receive a more lucrative deal from another buyer. And because Paramount is a giant of the television industry, its merger will be under scrutiny from the FCC.

Source: National Amusements & Skydance Media via Reuters

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Skydance Takes Over Paramount+ and Pluto TV in Major Media Deal

Skydance Takes Over Paramount+ and Pluto TV in Major Media Deal