Mario Gabelli, a long-time major shareholder of Paramount and its predecessor companies, is pressing for more information regarding the company’s pending merger with Skydance. Specifically, Gabelli, an investor and fund manager, is seeking better clarity on the financial data and valuation of National Amusements, Inc. This comes as Skydance and its backers are involved in an $8 billion two-step transaction to first take control of NAI and then merge with Paramount. The deal, valued at $4.75 billion for Skydance, is set to close in the third quarter of 2025.
Gabelli took to Twitter to advocate for what he called “Operation fish bowl,” an initiative aimed at increasing visibility into the transaction. He emphasized the importance of gathering data and understanding the intricacies of the deal. While there has been no mention of a lawsuit, reports have indicated that Gabelli may be taking legal action to obtain more information. Despite legal overtures, the specifics of any formal complaints or court filings remain unclear.
Gabelli’s primary concern lies with Paramount’s dual-class stock structure, which grants Shari Redstone’s NAI nearly 80% of the company’s Class A, or voting, shares. This leaves holders of Class B shares, including Gabelli, vulnerable to potential disadvantages in the context of an M&A deal. Gabelli Funds, owning nearly 4.9 million Class-A voting shares, has a vested interest in ensuring fair treatment for all shareholders.
Skydance’s offer, the latest in a series of proposals, included various sweeteners to appeal to Class B holders and mitigate the risk of lawsuits. Indemnification, or protection from lawsuits, emerged as a crucial deal point following Redstone’s withdrawal from a previous proposal in June. Disclosure of the price paid to NAI for both non-voting and voting shares was emphasized by Gabelli as a key aspect of transparency in the deal.
The Employees’ Retirement System of Rhode Island, echoing Gabelli’s concerns, filed a similar complaint last May in an attempt to compel the release of critical documents related to the merger. This legal action underscores the broader push for transparency and accountability in corporate dealings, particularly in high-stakes mergers and acquisitions.
Mario Gabelli’s efforts to extract more information about Paramount’s merger with Skydance shed light on the complexities and challenges of navigating major corporate transactions. The battle for transparency in the business world is ongoing, with stakeholders like Gabelli playing a crucial role in holding companies accountable for their actions and ensuring fair treatment for all shareholders. As the merger progresses, the push for clarity and disclosure will continue to be a key focus for investors and industry analysts alike.
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