Shari Redstone Repays $200 Million Debt with Larry Ellison’s Assistance

Shari Redstone, the daughter of the late media mogul Sumner Redstone, recently paid off a significant debt totaling nearly $200 million for her family business, National Amusements Inc. (NAI), which controls Paramount Global. The Wall Street Journal got confirmation from sources that a substantial part of the funds came from tech billionaire Larry Ellison.

The debt repayment was made last month, with Redstone covering $186 million owed by NAI, which holds 77.5% of the voting stock in Paramount Global. According to a source familiar with the matter, most of the cash came from Ellison, whose son, David Ellison, is CEO of Skydance Media, a Hollywood studio known for producing major blockbusters such as «Top Gun: Maverick» and «Mission: Impossible – Fallout.»

In 2018, Redstone secured a loan with a high interest rate of 11.5%, scheduled to mature in May 2025. Despite not being due, Redstone chose to settle the amount in full, amidst rumors of financial strain as Paramount struggles with challenges across its various sectors, including CBS and several cable networks like MTV and Nickelodeon.

Industry insiders note that the early payoff followed moves in February by National Amusements to sell real estate assets to meet a $40 million debt obligation. «Shari needed money and couldn’t wait until the deal was consummated,» disclosed an industry source.

This financial maneuver comes in the wake of an impending $8 billion merger between Skydance and Paramount Global, a deal led by David Ellison, intended to create a new media powerhouse. Questions regarding the fairness of the deal have emerged, with concerns voiced that Redstone might have accepted a lower offer instead of maximizing shareholder value, as certain competing bids were reportedly higher.

The merger’s structure includes paying $15 a share for up to $4.3 billion of Paramount’s common stock, approximately half of its market capitalization. This decision sparked criticism for valuing Skydance at an astronomical multiple relative to its earnings before interest, taxes, depreciation, and amortization (EBITDA).

Paramount’s board of directors has approved the merger, which is anticipated to complete in the early part of the upcoming year. Despite the merger’s prospects, Paramount’s stock continued to trade around $10 earlier this week. Notably, comparisons have arisen surrounding past acquisitions, such as Amazon’s significantly lower multiple when acquiring MGM in 2021.

As market analysts continue to debate the merit of the merger, Skydance’s EBITDA is forecasted to increase sharply, courtesy of its film pipeline. These developments are closely monitored by investors, as exemplified by a plea from Paramount’s second-largest shareholder to the Federal Communications Commission regarding the merger review.

Paramount’s planned acquisition of Skydance reflects a strategic gamble on future performance, with expectations set on substantial revenue growth in 2025. However, industry insiders suggest that the ultimate success will depend heavily on meeting these projections.