Byron Allen’s latest takeover bid: Paramount for $14 billion

Media mogul Byron Allen has extended yet another multibillion-dollar takeover offer – this time a $14.3 billion bid for film and TV giant Paramount Global, parent of the CBS broadcast network and cable outlets including Nickelodeon, the CW and MTV.

Allen is offering $28.58 each for the voting shares of Paramount, a 50% premium to recent trading, and $21.53 for the nonvoting shares, people familiar with the matter said.

Including existing debt, the total value of the deal rises to about $30 billion.

Allen joins a growing list of parties interested in Paramount, owner of some of the most-prized assets in entertainment.

The company, controlled by Shari Redstone and her family, has been in play for months after independent producer David Ellison began discussing a buyout of their shares last year.

Class A shares of Paramount, the voting stock, rose as much as 29% to $24.74 in New York, staying below the offer price.

The Class B shares reached $15.70, a gain of 15%.

In a letter he sent to Paramount and reviewed by Bloomberg News, Allen said he would finance the offer with a combination of secured and unsecured senior debt and equity.

“We are highly confident that if we have full access to the company’s internal due diligence information, we will be able to structure the capital structure to best provide for the company’s future growth prospects,” Allen said in the letter.

Representatives for Paramount declined to comment.

Allen has taken big swings before, including a bid for Paramount’s BET and VH1 channels. He tried to line up funding in recent months to make a bid for several E.W. Scripps Co. television stations and made a $10 billion offer to Walt Disney Co. last year to buy its ABC TV network, local stations, as well as the FX and National Geographic cable channels.

His Allen Media Group owns 22 TV stations, along with the Weather Channel, compiled in a series of deals valued at more than $1 billion.

“This $30 billion offer, which includes debt and equity, is the best solution for all of the Paramount Global shareholders, and the bid should be taken seriously and pursued,” Allen’s company said in a statement.

Paramount – the crown jewel in a global media empire controlled by the Redstones – would be tough to digest. Through nine months of last year, the company generated operating income of $1.87 billion before depreciation and amortization, a 30% decline from the year before. Sales, at $22 billion, were flat. Allen would be borrowing at a time of much higher interest rates than some of his previous acquisitions.

Allen’s plan is to sell the Paramount film studio, real estate and some other intellectual property, according to the people, who asked not to be identified discussing nonpublic information. He would keep the TV channels, including the Paramount+ streaming service, and run them on a more cost-efficient basis.

Allen sent his offer via text message and email to Paramount senior management and board members.

In wasn’t his first offer. In April of last year, Allen made a bid for the company but was rebuffed because the board “believed there was a pathway to a higher price,” he wrote in the letter. The shares have lost 37% of their value since then, he wrote.

A stand-up comic who branched out to producing TV shows, Allen has acquired a string of local TV stations from Honolulu to Tucson, the Weather Channel and numerous digital assets. If he’s successful in his Paramount bid, he will roll his existing TV assets into the new company.

Allen has said he has a better chance of acquiring media assets than other potential bidders because he’s already won regulatory approval to own TV stations. His station group isn’t large enough to trigger limits on ownership.

Last year, Allen bid for Paramount’s BET and VHF channels, and reiterated that $3.5 billion offer last month in an email to the board.

In September, he sent Disney Chief Executive Officer Bob Iger a text with his $10 billion offer for the ABC network and other channels. Iger, who had previously suggested he’d considered offers, later said he didn’t want to sell.

Allen has unsuccessfully thrown his hat in the ring at other times to purchase properties ranging from TV station owner Tegna Inc. to the Denver Broncos football team.