A deal worth $28 billion between media giant Paramount Global and heavyweight film production firm Skydance – which has been in the works for the last six months – has now been finalized and announced officially.

Through this tie-up, New Paramount has been formed, through two separate transactions. Firstly, Skydance will acquire the National Amusements firm which owns the controlling stake (77%) in Paramount, while this will then be followed by a merger between Skydance and Paramount Global.

The overall deal, both parties have said, will “stabilize and strengthen Paramount as a world-class media enterprise, with a focus on technological advancements, across multiple entertainment platforms.”

Preliminary terms around this deal – which is also backed by the RedBird Capital Partners investment firm – were first reported last week. This comes after Shari Redstone, chair of Paramount Global, called off discussions last month after (at that point) failing to agree terms.

Redstone, also chief executive of National Amusements, has now said: “Our hope is that the Skydance transaction will enable Paramount’s continued success in this rapidly changing environment. As a longtime production partner to Paramount, Skydance knows Paramount well and has a clear strategic vision and the resources to take it to its next stage of growth.”

Redstone’s father, Sumner, first bought the company in 1994.

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David Ellison, Skydance’s founder and chief executive, added: “This is a defining and transformative time for our industry and the storytellers, content creators, and financial stakeholders who are invested in the Paramount legacy and the longevity of the entertainment economy.”

New Paramount will see Ellison come in as chair and chief executive, with Jeff Shell – previously the NBCUniversal chief executive and now chair of RedBird Sports & Media – named as president.

The deal will see National Amusements being sold to Skydance for $2.4 billion after the latter firm merges with Paramount for $8 billion.

RedBird’s founder and managing partner Gerry Cardinale has also commented, saying: “RedBird is making a substantial financial investment in partnership with the Ellison family because we believe that the pro forma company under this leadership team will be the pace car for how these incumbent legacy media businesses will need to be run in the future.”

Media assets owned by Paramount Global include US network CBS, the UK’s Channel 5 and Network 10 in Australia, and the Paramount+ streaming service.

From a sports rights point of view, CBS holds rights to several major properties such as European club soccer’s UEFA Champions League, American football’s NFL, PGA Tour golf, and top-tier college sports. Earlier this year, it aired the most-watched NFL Super Bowl in history.

At the end of May, Paramount Global’s president and chief executive Bob Bakish stepped down from those roles amidst tension between himself and Redstone.

Paramount Global’s latest set of quarterly earnings saw revenue rise by 5% to $7.69 billion, and operating losses only come to $417 million. That number was up at $1.23 billion a year ago.

The conglomerate was initially formed by the merger of CBS with Viacom in 2019. Redstone has been exploring a sale of Paramount since 2023 amid ongoing struggles including falling revenues and growing costs that have kept the conglomerate and its constituent businesses from profitability.