We were focussing inwards, on fixing Last Movie Outpost for a few days, and what happens? One of the biggest deals in Hollywood collapses. Months of negotiations, millions in lawyers fees, meeting after meeting, and the merger talks between Paramount and Skydance have collapsed.
According to the report in The New York Times it was Paramount‘s controlling shareholder, Shari Redstone of National Amusements, Inc., that broke them off.
Paramount’s special committee set to vote on the deal when, suddenly, lawyers for National Amusements emailed the committee to say it was ending the discussions and to stand down.
According to the e-mail, National Amusements and Skydance had come to an agreement on economic terms, but could not agree on “noneconomic terms”.
In the cut-and-thrust world of M&A this can mean people issues, differences of opinion, personality, and ego clashes. An expectation that somebody would get a seat on the new board is suddenly refused. A job title or place in the hierarchy is not acceptable to a key decision-maker. The location of the head office. Ongoing access to the corporate jet. These are all amusing things in the world of Hollywood alphas that will derail an entire deal.
National Amusements has issued a statement:
“[We are] grateful to Skydance for their months of work in pursuing this potential transaction and look forward to the ongoing, successful production collaboration between Paramount and Skydance.”
This one has the potential to run and run. There will be some salacious rumors coming out of this, no doubt. Paramount, meanwhile, remains a target and needs to cut costs.
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