Paramount Global has been in a whirlwind of activity, marked by significant events such as the layoff of 800 employees in February and the ongoing discussions about a potential merger with Skydance Media. Adding to the mix, the current CEO, Bob Bakish, is stepping down, underscoring the magnitude of changes at the mass media and entertainment conglomerate.
The CEO’s unseating comes during Paramount Global and Skydance Media’s possible merger discussions. Skydance is pursuing Paramount, offering a sweet deal of $3 billion to assist the company in paying off debts and buying back stocks. With the possibility of a merger inching closer, as the companies engage in exclusive talks to pursue the deal and already put a special committee in place, Bakish’s departure is already set to be filled by a trio of CEOs by what Paramount called an “Office of the CEO.”
Bakish joined Viacom in 1997 and climbed the corporate ladder until he became the company’s CEO in 2016. After the merger of Viacom and CBS, later renamed Paramount Global, Bakish became the CEO of the combined company in 2019.
Privately disagreeing with the potential merger, Paramount announced Monday that the CEO will be stepping down from his position and leaving the company’s board of directors. Bakish has argued that the merger will dilute common shareholders in a report by CNBC, as the proposed deal would allow Skydance media and its private equity backers to claim 50% of the merged company, with the remaining percentage being owned by common shareholders, and remain publicly traded.
Bakish’s removal as CEO on Monday became effective immediately, with patience wearing thin and losing the trust of some of Paramount Global’s shareholders. The controlling shareholder, Shari Redstone, could see Bakish’s removal as a means to propel the Skydance Media deal forward more quickly.
Paramount’s struggle to generate revenue growth in recent years is no secret, with the company reporting mixed results for the first quarter. However, overall revenue was up by 6% compared to last year’s period, most likely due to the many nationwide viewers who turned on the TV to watch the Super Bowl.
Paramount Global’s financial performance in the first quarter was mixed. While overall revenue increased by 6% compared to the same period last year, the company’s direct-to-consumer streaming services, including Paramount+, Pluto TV, and BET+, saw a significant boost in revenue by 24%. Paramount+ alone gained 3.7 million subscribers, bringing the total to 71 million. However, despite narrowing down losses to $286 million from $511 million last year, the streaming service still posed a financial challenge for the company.
Stepping into the leadership roles at Paramount Global are a trio of CEOs, each bringing their unique expertise. George Cheeks, the president and CEO of CBS; Chris McCarthy, the president and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, the head of Paramount Pictures and Nickelodeon, will work closely with Paramount CFO Naveen Chopra, and the board to develop a comprehensive, long-range plan. They will focus on accelerating growth, developing popular content, streamlining operations, strengthening the balance sheet, and optimizing the streaming strategy.
