Paramount Global’s board of directors is poised to vote Tuesday on David Ellison’s proposed takeover of the troubled media company amid divisions among board members, which have raised the level of drama in an already tumultuous sale process.
Two sources familiar with the sales process confirmed that the lead independent director, Charles Phillips, has long been opposed to Ellison’s production firm Skydance Media’s transaction to assume control and is expected to vote against the proposed deal.
Controlling shareholder Shari Redstone did not participate in Tuesday’s meeting. Instead, the five independent directors, who are tasked with looking out for the financial interest of all Paramount shareholders, were set to meet.
Redstone has long favored the Ellison arrangement, believing it was the best viable option to preserve the media company her family has controlled for more than 35 years. Any deal requires the Redstone family’s approval because it controls 77% of the voting shares in the company that owns Paramount Pictures, CBS, BET, MTV and Comedy Central.
The board meeting is set for 11:30 a.m. Pacific time, one of the knowledgeable people said.
More than a week ago, Paramount Global’s independent directors signaled their approval of Ellison’s bid after a nearly six-month review process that exposed deep divisions within the media company. Phillips, a former executive of Oracle, the company that David Ellison’s father Larry Ellison co-founded, has long been “an antagonist” of the deal, one of the knowledgeable people said.
Earlier this month, four board members exited the board leaving just six board members, including Redstone. Tensions over the deal have plagued the board throughout the year. In April, Paramount Chief Executive Bob Bakish was ousted. He also opposed the Ellison deal.
Corporate governance experts said the transaction will invite shareholder lawsuits because of the Redstones’ outsize influence in the company.
Ellison has been pursuing Paramount since last summer. On Monday, following a weekend of negotiations, lawyers for the two sides — Skydance and the Redstone family — had agreed on several major outstanding issues but were still grappling with remaining deal points, according to three knowledgeable people who were not authorized to comment given the delicate nature of the talks.
Puck’s Matt Belloni first reported news of the meeting and Phillips’ opposition.
