Paramount Global CEO Bakish is out, replaced by trio of executives

By Christopher Palmeri

Paramount Global replaced Chief Executive Officer Bob Bakish, appointing a management committee as the board negotiates a possible change in control of the company.
 

Three of Paramount’s most senior executives — film and kids programming chief Brian Robbins, Showtime/MTV head Chris McCarthy and George Cheeks, who leads CBS — will run the company, according to a statement released Monday.

The broadcast and cable TV giant is negotiating a possible deal with independent producer Skydance Media, led by David Ellison. Under the terms being considered, Ellison, the son of Oracle Corp. founder Larry Ellison, would buy the voting shares held by Paramount Chair Shari Redstone and her family and merge Skydance with Paramount. Ellison would become the company’s new CEO. 

Separately, Paramount reported first-quarter earnings that beat Wall Street estimates, buoyed by its broadcast of the Super Bowl in February and narrower losses from streaming.

Earning rose to 62 cents a share excluding some items, the company said in a statement, compared with the 36-cent average of analysts’ estimates. Revenue grew 5.7 per cent to $7.69 billion, missing the $7.74 billion projected on Wall Street.

The company made progress on two fronts, getting a boost in advertising sales from the Super Bowl and improving results at the Paramount+ streaming service. 

Subscribers to the service increased to 71 million, beating projections of 69.8 million. The loss from streaming for the quarter shrank to $286 million, compared with analysts’ estimates of $347.1 million.

Shares of Paramount were up 2 per cent to $12.49 in extended trading.

Ellison and a committee of Paramount’s independent board members have been in exclusive talks about a deal for several weeks. The exclusive period ends May 3. 

An Ellison deal, which hasn’t been formally announced, has been controversial internally and externally, with several shareholders saying that Paramount should consider other options, such a sale of the whole company. Apollo Global Management Inc. has been among the potential suitors.

Over the weekend, the Redstone family and Ellison offered concessions to make a possible change in control at Paramount more appealing to the company’s other investors, Bloomberg reported. 

On a conference call with investors in February, Bakish said, “We’re always looking for ways to create shareholder value. And to be clear, that’s for all shareholders.”

Redstone picked Bakish to run Viacom Inc. after ousting then-CEO Philippe Dauman. The executive, who rose through the ranks of the company’s international channels, took over the renamed Paramount Global in 2019 after Viacom and CBS Corp merged. He built out the Paramount+ streaming service, but that business has continued to lose money at the same time that the company’s traditional TV channels have struggled amid an advertising slump. 

Paramount’s namesake film studio was also unprofitable last year, and the company’s nonvoting shares have lost more than 80 per cent of their value since hitting a 2021 high.

Bakish lost the confidence of Redstone and some board members for not taking advantage of opportunities to sell the Showtime and BET networks in a way that could have reduced the company’s debt load, according to people familiar with the board’s thinking.