That merger that entertainment giant Paramount (PARA) hoped would hit this summer may end up being off altogether. That visit to Chancery Court in Delaware delivered a rather potent conclusion to go with it, and now, the Skydance merger may be off altogether. Paramount shareholders eagerly awaited another bidding war, and sent shares up nearly 2% in the closing minutes of Tuesday’s trading.
Word from the New York Post made it clear: the Skydance merger may not be on after all. Chancellor Kathaleen McCormick called for “more information” from the pension funds that sued to block the merger following word from Project Rise Partners, which would have beaten Skydance’s $8 billion offer by another $800 million.
While this does not specifically prevent the merger, the call for more information suggests that the Chancery Court is not willing to simply throw the matter out altogether. Rather, the report noted, the move to delay a decision is commonly “…bad for the people who did not bring the case.” The report summed up Paramount’s current position surprisingly well: “Paramount probably has real problems in court.”
The 60 Minutes Blame Game
Meanwhile, another report suggests that Skydance saw problems coming from the now-infamous 60 Minutes interview with then-Vice President Kamala Harris and tried to get out in front of it. Jeff Shell, executive with Skydance Media, reportedly put pressure on CBS News in a bid to get the transcript of the interview released.
His effort was soon met with pushback from CBS News proper, as both chief Wendy McMahon and 60 Minutes head Bill Owens both stood up to Shell, claiming that such a release would be a bad idea as it would be seen as “folding under political pressure.” But Shell, given that he would be head of the new operation anyway, ended up coming out on top. That now-Federal Communications Chairman Brendan Carr also called for the transcript before becoming chairman likely did not hurt matters either.
Is Paramount Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Hold consensus rating on PARA stock based on two Buys, five Holds and five Sells assigned in the past three months, as indicated by the graphic below. After a 11.82% rally in its share price over the past year, the average PARA price target of $12.50 per share implies 8.84% upside potential.
