The transaction involves Skydance acquiring controlling shareholder Shari Redstone's National Amusements Inc., thus bringing an end to the Redstone family's ownership of the historic entertainment conglomerate.

The deal, which underwent months of negotiations, not only encompasses Paramount Studios but also includes Paramount+, CBS, MTV, Nickelodeon, and Pluto. In a statement, Shari Redstone expressed the importance of fortifying Paramount for the future while prioritizing content as king, acknowledging the ever-changing landscape of the industry.

Under the agreement, backed by RedBird Capital and the Ellison family, the deal provides a total of $8 billion in cash and stock. This includes $2.4 billion for National Amusements Inc., $4.5 billion for non-NAI shareholders in Paramount, and an additional $1.5 billion in new capital to address debt and recapitalize the company's balance sheet.

As part of the deal, David Ellison, the founder of Skydance Media, will assume the roles of Chairman and CEO, while former NBCUniversal CEO Jeff Shell will become President. The transaction is expected to close in the first half of 2025.

Skydance Media, valued at $4.75 billion, will issue 317 million Class B Shares, priced at $15 per share, to Skydance equity holders. Post-transaction, Skydance Investor Group will hold 100% of New Paramount Class A Shares and 69% of outstanding Class B shares, representing approximately 70% of the pro forma shares outstanding. Shareholders of Paramount will receive a premium of 48% for Class B stock and 28% for Class A shares.

Expressing his gratitude, David Ellison emphasized his commitment to revitalizing Paramount through the infusion of contemporary technology, innovative leadership, and a renewed creative discipline aimed at enriching future generations.

The deal also includes the acquisition of National Amusements Inc. from Redstone for $1.75 billion, gaining control of 77% of Paramount's class A voting stock. While other potential bidders, including IAC chairman Barry Diller, producer Steven Paul, and Sony Pictures Entertainment, had expressed interest in acquiring Paramount, the deal with Skydance prevailed.

The agreement signifies a turning point for Paramount, which has recently been led by co-CEOs Brian Robbins, George Cheeks, and Chris McCarthy. These executives have been working on a long-term strategy to reduce the company's $14.6 billion debt, accelerate streaming profitability, and drive revenue growth. As part of this strategy, the co-CEOs have hired bankers to help with asset sales and have initiated talks with potential partners in international markets to enhance their streaming business.

The conclusion of the deal marks the end of an era for the Redstone family and ushers in a new chapter for Paramount under the stewardship of Skydance Media. The conference call with investors to discuss the transaction is scheduled for 8:30 a.m. ET on Monday.