Edgar Bronfman’s Offer to Paramount Could Keep Shari Redstone on Board

Edgar Bronfman Jr. offers to take a controlling stake in Paramount Global could keep Shari Redstone at the company, if his efforts are successful.

Bronfman is open to letting Redstone, currently a non-executive chairman at Paramount, stay on if Paramount’s special committee approves his group’s offer to National Amusements, the controlling shareholder, according to a person familiar with the matter.

Bronfman has raised $6 billion to challenge Skydance Media for ownership of National Amusements, the parent company founded by Sumner Redstone, according to people familiar with the matter. Both Bronfman’s bid and Skydance’s bid would also include money to buy out a percentage of Paramount Global’s common stock.

At $6 billion, Bronfman’s bid would provide cash to about 20% of Class B shareholders at $16 a share. Skydance would pay about 50% to current Paramount common investors at $15 a share as part of the bid, according to people familiar with the matter.

It’s unclear which offer Redstone prefers. Paramount Global’s special committee will decide on August 28 whether Bronfman’s offer is a better proposition for shareholders. If the committee decides Bronfman’s is the better offer, Skydance will have four business days to match it. The deadline for the entire process to close is September 5.

Bronfman still has days to raise more money for a competing bid against Skydance, which has agreed to an $8 billion deal to merge with Paramount Global. last month. Special Committee earlier this week extend the so-called “shopping” time — during which time the company can consider competing offers — within 15 days to review Bronfman’s initial bid.

One of Bronfman’s bidders was former AOL CEO Jon Miller, who argued that Redstone would have more future control over Paramount Global than Skydance. Miller, a close Redstone ally, has connected Bronfman to potential funding and would likely take a role in the company if it were under Bronfman’s control—perhaps a board seat and an executive job—according to people familiar with the matter. Bronfman would be CEO of the company if his deal is accepted and executed, these people said.

Miller, Redstone and Redstone’s son-in-law, Jason Ostheimer, together run Advancit Capital, a small venture capital firm that invests in media and technology. The trio are the only three people to appear on the show. Company website Miller has also served as a de facto strategic adviser to Redstone for years, according to people familiar with the matter.

Redstone has not yet spoken to Miller about the offer, according to people familiar with the matter.

While the Redstone and Bronfman families have many similarities, including donating heavily to Jewish organizations, Edgar Bronfman Jr. and Shari Redstone have never met many times and did not have a close relationship beforehand, the two people said.

Skydance CEO David Ellison and Redstone have had several discussions about the potential for Redstone to remain a shareholder in a merged Skydance-Paramount Global, according to people familiar with the matter.

Redstone is taking a wait-and-see approach to any future involvement in Paramount Global regardless of who owns the company, according to a person familiar with her thinking.

Spokespeople for Redstone, Bronfman, the Paramount Global special committee and Skydance all declined to comment.

Bronfman has spent the past few weeks gathering individuals interested in owning a piece of Paramount Global, including film producer Steven Paul and Patron co-founder John Paul DeJoria, who had previously considered making a separate bid, as well as Fortress Investment Group, the credit arm of private equity firm BC Partners and former Turner Broadcasting CEO John Martin, according to a person familiar with the process.

Bronfman’s financing comes from a variety of sources, which could raise regulatory concerns if too much money comes from foreign entities. Having so many different backers could also make Bronfman’s offering riskier than Skydance’s, which is backed by private equity firm RedBird Capital and billionaire Larry Ellison, David Ellison’s father.

Bronfman is the president of Phu Bo, a sports streaming service and a former executive at Universal and Warner Music.

Skydance lawyers sent a letter to Paramount Global’s special committee asking the company to stop negotiating with Bronfman, the Wall Street Journal reported. reported on Thursday. Skydance said Paramount Global breached the terms of the go-shop agreement by failing to notify Skydance of plans to extend the airtime, the report said.

Skydance also argued that the special committee did not have the power to extend the trial period because a bid must “reasonably be expected to result in a better proposal.” Skydance argued that Bronfman’s bid did not meet the criteria.

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