Deadline: Paramount Shares Dip On Report Sony “Rethinking” $26 Billion Bid

Story from Deadline:

Shares of Paramount Global dipped in afternoon trading on a CNBC report that Sony may be “rethinking” a joint bid with Apollo for the company.

A person familiar with the situation said there’s no indication Sony is pulling out of a deal. And the CNBC report noted that the “rethinking” may mean a restructuring of what would be a very complex transaction.

The studio and private equity fund made a formal, but preliminary, $26 billion offer for the company controlled by Shari Redstone just as Par’s monthlong exclusive negotiating window with Skydance expired early this month. It wasn’t extended, but the David Ellison-led studio backed by Larry Ellison and RedBird Capital still has an offer on the table.

A special committee of the Paramount Global board met then to consider the Sony-led deal, which is preferred by Paramount stockholders.

Sony and Apollo would need to conduct due diligence, a deep dive into Paramount’s financials and operations, in order to come up with a final offer but that process has not yet started, so the partners may be growing impatient. CNBC also cited Sony’s volatile stock price, as well as ongoing challenges in linear television.

The joint offer would also face regulatory scrutiny on several fronts.

Paramount stock, which was higher for much of the session, dropped more than 5%, now changing hands at about $12.35. The shares have been buffeted by deal speculation all year.

It has been rather quiet on the Par deal front after a flurry of news as Skydance revised its offer several week ago. Its deal would see Skydance acquire Redstone’s controlling stake and pro-rated number of shares help by other stockholders. Paramount would go private.

Sony and Apollo, meanwhile, would buy in the company for cash, taking it private.