05:06 AM EDT, 07/08/2024 (MT Newswires) -- (Updates throughout to add more details about the merger.)

Paramount Global ( PARAA ) has entered into a definitive agreement to merge with Skydance Media to form New Paramount at an enterprise value of about $28 billion, Skydance said Sunday.

The merger will take place through a two-step transaction, which includes the acquisition of National Amusements, which holds a controlling stake in Paramount.

Skydance Investor Group, comprised of the Ellison Family and RedBird Capital Partners, will invest $2.4 billion to acquire National Amusements for cash and $4.5 billion for the merger.

Existing Skydance investors will receive 317 million newly issued class B shares in New Paramount, valuing Skydance at $4.75 billion, based on $15 per Paramount class B share. Paramount's class A stockholders will receive $23 per share.

After closing, Skydance Investor Group will own 100% of New Paramount class A shares and 69% of outstanding class B shares.

David Ellison, founder and chief executive officer of Skydance, will become chairman and CEO of New Paramount.

This comes after Paramount said Sunday that its board's special committee approved the merger agreement, which includes a 45-day go-shop period that allows the special committee and its representatives to actively solicit and consider alternative acquisition proposals.

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