Massive Hollywood Film Studios Eye Merger

Sony Pictures and Apollo Global are reportedly considering a joint bid to buy out Paramount Global.

Sources with knowledge of the matter say that the purported plans are far from taking root and that several roadblocks are standing in the way of the merger.

This news comes after earlier reports of a credit downgrade for Paramount. The S&P ratings agency downgraded Paramount’s credit rating from BB+ to BBB- last month.

Paramount, like many entertainment giants, is facing financial troubles brought on by shortfalls in streaming revenues.

While it remains to be seen if the merger will be completed, here is what is currently being reported about the speculative merger:

Sony Pictures Entertainment and Apollo Global Management are considering a possible joint bid for Paramount Global.

Sources close to the situation confirmed the conversations but cautioned that there are numerous obstacles that would need to be overcome before the sides could… pic.twitter.com/0u0DKEjk8J

— Variety (@Variety) April 19, 2024

A deal to buy Paramount Global that includes Japan’s Sony Group would be expected to draw scrutiny from US regulators who vet media purchases by foreign buyers https://t.co/gc55ej22ZG

— Bloomberg (@business) April 19, 2024

Sony is considering joining up with Apollo Global Management on its bid to buy Paramount Global, Axios has confirmed.https://t.co/JubY73FUI7

— Axios (@axios) April 19, 2024

According to Reuters:

Sony would hold a majority stake in the joint venture and operate the media company, and its library of films, including such classics as “Star Trek,” “Mission:Impossible” and “Indiana Jones,” and television characters like SpongeBob SquarePants, according to the source.

Sony Pictures Entertainment Chairman Tony Vinciquerra, a veteran media executive with deep experience in film and television, would likely run the studio and take advantage of Sony’s marketing and distribution.

Paramount Global’s stock surged on Friday as a result of the news and is trading at around $12.44 at the time of this writing.

The film studio’s stock has been in a steady decline over the last two years, down from a previous price of around $40.

The New York Post provided more financial data:

Paramount shares are down nearly 7% since April 3 when Reuters reported that the company had began 30-day exclusive negotiations with Skydance.

The stock closed Friday at $12.44, up 13%, giving it a market cap of more than $8 billion. The company’s market capitalization fell below $10 billion in January.