M&A News: Sony and Apollo Could Break Up Paramount (NASDAQ:PARA)
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M&A News: Sony and Apollo Could Break Up Paramount (NASDAQ:PARA)

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If Sony and Apollo acquire Paramount, they plan to break up the company, according to a New York Times report.

The race for media company Paramount (NASDAQ:PARA) continues to intensify. According to a New York Times report, there is news that if Sony Pictures Entertainment (NYSE:SONY) and the private equity giant Apollo Global Management (NYSE:APO) manage to acquire the company, they will break it up.

Paramount is up for sale as it faces significant headwinds, including the decline of cable TV and the decreasing profitability of its streaming services.

Sony and Apollo’s Plans for Paramount

According to the report, if Sony and Apollo Global acquire Paramount, they plan to sell off CBS, cable channels like MTV, and the Paramount Plus streaming service. Paramount Pictures, known for films like The Godfather and Top Gun, would be merged with Sony’s business.

Sony and Apollo, who recently expressed interest in acquiring Paramount for $26 billion, are expected to retain Paramount’s film and TV library, along with the rights to characters like Teenage Mutant Ninja Turtles and SpongeBob SquarePants.

Other Contenders for Paramount

There is no news yet on whether Paramount is still in discussions with Skydance after their exclusivity window for a deal lapsed on May 3. Additionally, there is a buzz that media baron Byron Allen is prepared to offer $30 billion for Paramount. In an interview with Bloomberg at the Milken Institute Global Conference, Allen didn’t deny having access to such capital but rather, expressed concerns about the “certainty of close” being the major issue. Certainty of close may refer to whether the acquisition of Paramount will be closed

Is PARA a Buy or Sell?

Analysts remain sidelined about PARA stock, with a Hold consensus rating based on six Buys, eight Holds, and seven Sells. Over the past year, PARA has declined by more than 20%, and the average PARA price target of $13.29 implies an upside potential of 3.7% from current levels.


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