I wouldn’t normally continue to cover the acquisition of Paramount by SkyDance, but this is intriguing:
Paramount has filed a petition with the Federal Communications Commission asking the regulator to allow foreign investors to hold more than 25% of the company’s equity and/or voting interests following the completion of the merger and to allow certain foreign entities to hold more than 5% of equity and/or voting interests in Class B stock.
In the filing, Paramount Global said that following the completion of the merger with Warner Bros. Discovery, which has been approved by the FCC and shareholders, the combined company would be 49.5% owned by foreign companies and that Middle Eastern investors would hold 38.5% of the company’s equity.
Those Middle Eastern investors include Saudi Arabia’s Public Investment Fund (15.1% equity stake), the United Arab Emirates’ sovereign wealth fund (12.8% equity) and the Qatar Investment Authority (10.6% equity). [tvtech]
Here’s what catches my attention, after admitting to no expertise in this industry, Federal laws and rules applicable, nor in the games the mega-rich play among themselves.
- The presumption upon ties to the Administration to secure special treatment that may not be available to their competitors. These ties are not obvious, but this article from The Guardian suggests a confirmation they exist:
Senior White House officials have discussed internally their preference for Paramount Skydance to acquire Warner Bros Discovery in recent weeks, and one official has discussed potential programming changes at CNN with Larry Ellison, the largest shareholder of Paramount.The discussions, according to people familiar with the matter, come as Paramount portrays itself as the best bid for Warner Bros Discovery, after the company announced last month it was open to offers, because it would have an easier time getting through regulatory review.
- Why do Middle East mega-rich have an interest in a media corporation? To make more money? Could be. For amusement? Sure. But it could be something more, now couldn’t it? I’ve written, somewhere, about the free press has, in essence, an undiscussed foundational assumption that it has society’s best interests at heart; a media controlled by malicious interests is like throwing sugar into your gas tank. Fox News will be used by some as an example of the consequences of a dishonest media, and it’s worth an examination.
- Could the powers controlling SkyDance looking at a cash problem? We can point at Larry Ellison and proclaim him a multi-billionaire, but this is not a pile of cash in the bank; it’s an estimate of the value of his investments, and investments have to be liquidated if they’re needed elsewhere. Are the owners of SkyDance so financially stressed that they want to bring in other investors to spread the risk? Is the risk considered that high?
- Or is this part of a competition taking place in the mega-rich arena? What does this mean?
Yeah, I’m not mega-rich, nor am I interested in being such; consequently, I really do not know the answer to the above. Watching this should prove enlightening. Or horrifying. Whichever.
