Five pension funds in New York state have filed a lawsuit in Delaware seeking to block Paramount Global’s blockbuster merger with Skydance Media.
The pension funds are seeking a preliminary injunction that would block the deal from taking effect while their lawsuit plays out in Delaware’s Chancery Court. The complaint comes about a week after a judge in the state ordered Paramount to turn over financial records to a pension fund in Rhode Island as part of a separate but somewhat identical lawsuit.
The case brought by the Rhode Island pension funds is probing whether National Amusements owner Shari Redstone had “conflicting interests” when she involved herself in discussions between Paramount and Skydance. National Amusements owns a controlling stake of Paramount stock.
The documents produced as a result of the Rhode Island lawsuit could be used to determine whether Paramount’s board effectively weighed acquisition offers brought by interested parties other than Skydance. The judge overseeing the lawsuit brought by the New York pension funds has not ordered Paramount to turn over any documents in that case, but the parties may also seek records showing Redstone’s interest in the merger was the prime consideration over that of minority shareholders, some of whom feel the deal does not benefit smaller owners and was mainly driven by Redstone’s self-interest.
The cases add to Paramount’s mounting headaches as it pushes for the Skydance deal to close within the next year. The deal involves Paramount’s famed movie studio and its television businesses, including CBS, which owns around two dozen licensed broadcast TV stations. The transfer of those licenses will require approval from the Federal Communications Commission, something that could be held up by newly-minuted FCC Chairman Brendan Carr, who expressed disapproval over CBS’s handling of an interview with Vice President Kamala Harris last November.
Earlier this week, CBS News agreed to furnish a transcript of the unedited interview as well as some video material to the FCC. The network also posted the transcript and videos to its website.
