Paramount board prepares to remove Bakish as CEO as M&A talks continue

Paramount Global’s board is reportedly preparing for its CEO to exit even as it remains in discussions to be acquired.

Bob Bakish, who has worked for Paramount, including under its former name Viacom, since 1997, is set to step down as early as Monday, April 29, 2024, The Wall Street Journal reported Friday, April 27, 2024. A later report indicated he would resign.

The potential ouster comes as Skydance Media and RedBird Capital are involved in advanced talks with Paramount’s board over a potential acquisition. The companies are currently under an exclusivity window that only allows Paramount to discuss a possible acquisition with Skydance and RedBird.

Meanwhile, Sony Pictures and Apollo Global Management have partnered to offer an all-cash buyout once the May 3, 2024, exclusivity period ends, assuming a Skydance-Paramount deal isn’t finalized by then, according to The New York Times.

Bakish’s departure comes amid pressure for him to exit, and Paramount’s board appears to be ready to have its chief exit as a potentially strategic move as acquisition talks drag on.

Bakish has reportedly lost the trust of Shari Redstone, who owns the controlling interest in Paramount through National Amusements. 

Part of the reasoning behind that is that it, should the Skydance deal come through, one condition would be that David Ellison, currently CEO of Skydance, would take over the top spot at the combined companies, not Bakish. Talks have also proposed RedBird executive Jeff Shell, who previously worked in senior roles at at NBCUniversal and Comcast, be installed to head up day-to-day operations directly under Ellison.

Talks have reportedly not focused on a post-merger role for Bakish.

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Bakish and majority shareholder Redstone have been under criticism by major investors over the Skydance deal because it would significantly dilute the value of shares held by most investors. Skydance is reportedly also considering a different structure that would make the dael more palatable to common holders, according to a Bloomberg report.

That said, Bakish’s exit could signal that Redstone may be considering letting minority shareholders have a say in any potential mergers. 

Even if the merger doesn’t move forward, Bakish’s exit still could have significant repercussions for Paramount, especially since it leaves the company without a clear leader unless a deal is reached soon.

Other shareholders are more included to not have a sale at all, though it appears such an option might be dwindling as Skydance improves its offer with a potential all-cash option also available.

Other issues Paramount is facing is a large amount of debt and a large portfolio of legacy, linear media business that face uncertain futures. Though it has invested heavily in streaming, that’s at least partially to blame for some of its debt.

Financial firms have lowered their debt rating on Paramount and the company has also had to halt some of the dividends it pays out.

Correction: An earlier version of this story incorrectly identified who would become CEO of the new company. It has been revised.