Five of New York City’s Pension Funds have filed a lawsuit trying to paramount In anticipation of $ 8 billion With Skydance Media, claimed that the control of shareholder Shari Redstone and members of Paramount’s special committee that evaluated the bids broke their duty of supervision.
The complaint, which was submitted on February 4 against Board members Barbara Byrne, Linda Griego, Judith Mchale and Susan Schuman and unsolved on Monday, claim that the group failed to consider an alternative offer of $ 13.5 billion from Project Rise Partners, as the New York City Pension System says is superior to the Skydance business.
The funds, which include Nycers, the New York City Fire Department Fund, New York City Pension Fund, New York City Board of Education Retirement System and Teachers’ Pension Systems in City of New York, are looking for a court decision to block the transaction closed until a final solution of its claims have been reached.
Paramount and the special committee refused to comment on the mood, which was obtained by Thewrap.
PRP has offered to acquire Paramount’s CLASS B shares for $ 19 per share -more than $ 15 per share in Skydance offering -and Class A shares for $ 23 per share, the same as Skydance offer. It also said that its bid offers up to $ 5 billion in debt restructuring, would add $ 2 billion to Paramount’s balance sheet and give the B -shareholders 51% of the company’s equity.
The All-Cash offer is supported by a group of investors including Cinémoi president and co-chair Daphna Edwards Ziman and Note Group’s founder and CEO Moses Gross.
“For Paramount’s shareholders in public class B, PRP’s offer is very superior to the unfair merger that is raised on them. But Redstone would be left worse, no longer because the NAI surplus, the Central Park apartment, the private jet and $ 200 million damages that Skydance agreed to pay her, “wrote the pension funds. “Each independent director should be bond to consider it on the merits and in good faith. But Paramount’s special committee did not. “
In an earlier statement to sue, Paramount’s special committee said that PRP did not submit an official proposal during the Skydance business’s 45-day Go-shop period or during the 7-month sales process.
“It is unclear what PRP’s goals are,” the committee added. “But Paramount is bound by its agreement with Skydance Media and there will be no commitment to PRP in violation of such an agreement.”
The pension funds claim that the special committee’s statement “raises contractual rights for two mutual transgressors over the supervisory tasks that the Special Committee is guilty of Paramount’s innocent public shareholders” and that its purely refusal to consider the agreement violates its duty of supervision.
NYC Pension Fund’s trial is the latest in a business of operations in the Delaware Court from Paramount shareholders over the deal.
Last month, a judge granted a request from the employees’ pension system on Rhode Island (ERI) to get books and items related to the Skydance merion. The Pension Fund, which claims to check the shareholder Redstone and her holding company National entertainment “exploited Paramount’s business opportunities”, investigates “potential errors, including whether to seek fair relief to ensure that Shari Redstone and NAI do not serve on their errors.”
Mario Gabelli – the largest shareholder in class A Paramount behind Redstone – has also submitted a Books and postal requests to investigate the finer details of the transaction.
On one formal complaint Gabelli, who was submitted to the Delaware Court, said that Paramount has produced a total of 168 documents since his first request, consisting of “mainly sanitized board and committee minutes, transaction documents and board issues.” He added that there is a “credible foundation to believe that NAI, board members and possibly leading officials in Paramount may have violated their supervisory tasks to the company because NAI has obviously orchestrated a transaction to benefit himself.”
A trial is set for April 2025, according to Paramount’s updated S-4 application to the US Securities and Exchange Commission.
Paramount shareholders Scott Baker has also filed a proposed lawsuit and claims that the Skydance affair can cost the shareholders $ 1.65 billion in damages, while funds led by California State Teachers’ Retirement System (Calstrs) has claimed in another separate application that the damage could exceed that figure.
The MediaGiganten is also facing a mood from live video.AI Corp in the southern district in New York, which claims that its offer to buy Paramount was not fairly viewed and claims claims of unfair competition, tortious involve Supply duty, among others, and seeks unspecified monetary damage, costs and other relief.
In addition, Paramount in the updated S-4 revealed that other Class A and B shareholders have delivered demand letters trying to inspect the company’s books and registers to investigate violations of supervisory obligations. Some shareholders in Class B have also sent demand related to alleged failures in New Paramount’s registration declaration.
Paramount-Skydance affair is currently about to close during the first half of 2025. But the company’s S-4 warns that litigation can prevent or delay the business closure, resulting in significant costs for Paramount, including damages by board members and officials.
“One of the conditions for the termination is the absence of any order or legal requirement that enjoys, limits or otherwise prevents the implementation of the transactions,” says the application. “If a complainant would seek and obtain a ban prohibiting the implementation of the transactions on the agreed conditions, such an injunction may prevent the transactions from being carried out or implemented within the expected time frame.”
In addition to the legal obstacles, Paramount and Skydance must win the approval of the FCC, which examines the transaction due to a necessary transfer of broadcast licenses for Paramount 28 owned and operated stations. FCC has received petitions from Gabelli, Livevideo.ai, Hollywood’s Teamster Union, the Latino-owned entertainment company Fuse Media and Conservative Public Interest Law Firm Center for American Rights.
FCC has initiated a separate investigation In a “60 minutes” interview with Kamala Harris about allegations of “news distortion.” The interview has also led to a separate review by President Donald Trump, which suits the $ 20 billion network, claiming that the interview was edited to make Harris look good before the 2024 election.
If the implementation of the transaction does not occur before April 7, subject to two automatic 90-day extensions, or if a regulator blocks the merger, both Paramount and Skydance have the opportunity to terminate the deal. Exercising that option would leave Paramount on the hook to pay Skydance a $ 400 million fee.
