Paramount merger: what does this mean for its shares?
The Paramount merger with Skydance Media will create a group worth $28 billion. But what will this mean for its stock?


One of Hollywood’s oldest companies, the entertainment giant Paramount Global, has agreed to merge with independent film studio Skydance Media, creating a group worth $28 billion, says Peter Hoskins on the BBC.
As part of the “complex” deal, Skydance will pay $2.4 billion for National Amusements, owned by non-executive chair Shari Redstone. It holds just 10% of Paramount Group’s shares, but accounts for almost 80% of voting rights. It is the “end of an era” for the Redstone family, which “transformed a chain of drive-in cinemas into a vast media empire”.
No wonder Redstone is throwing in the towel, says AJ Bell’s Russ Mould. The stock has fallen by 78% in five years, while rival Netflix has gained 85%. The problem was Paramount’s “big gamble” on the streaming sector, with its Paramount+ platform “failing to gain the kind of traction enjoyed by Netflix, Amazon Prime Video and Disney+”.
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With streaming platform owners now focusing on making a profit on their services, rather than just building up market share, Skydance “will have to think long and hard about Paramount Plus’s future” if it wants to bring a sense of “sparkle” to the company.
Given that Paramount+ is “haemorrhaging money while reaching approximately a quarter of Netflix’s 270 million subscribers”, says Jennifer Saba on Breakingviews, completely ditching the “subscale, expensive direct-to-consumer strategy should be on the table”.
The focus should be on partnerships, with Paramount and “much-better-equipped Goliath” Comcast already in talks about streaming jointly. Selling content to other streaming services should also be explored.
The deal highlights that the post-Netflix era has been a “costly bust for the stragglers of media, like fellow family-controlled pipsqueak AMC Networks or even Warner Bros. Discovery”.
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Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.
He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.
Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.
As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.
Follow Matthew on Twitter: @DrMatthewPartri
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