Paramount Global ousts chief Bob Bakish as future of media conglomerate hangs in the balance

New York (CNN) — Paramount Global on Monday parted ways with its chief executive, Bob Bakish, in a seismic move that sent reverberations through the media conglomerate as it actively engages in acquisition talks with Skydance Media.

In place of Bakish, who led the company since controlling shareholder Shari Redstone reunited Viacom and CBS Corporation under one roof in 2019, will be a triumvirate of leaders: Brian Robbins, chief executive of Paramount Pictures; Chris McCarthy, chief executive of Showtime and MTV Entertainment Studios; and George Cheeks, chief executive of CBS.

“The Board and I thank Bob for his many contributions over his long career, including in the formation of the combined company as well as his successful efforts to rebuild the great culture Paramount has long been known for. We wish him all the best,” Redstone said in a statement.

The team of three leaders will guide the company in the interim as Paramount’s board negotiates a deal with Skydance, which is led by David Ellison, son of the billionaire Larry Ellison, ending the Redstone family’s control of the company, which has produced blockbuster franchises including “Top Gun,” “Star Trek” and “Transformers.”

The relationship between Redstone and Bakish had become frosty in recent months, people familiar with the matter told CNN. Redstone and other board members took issue with Bakish’s strategic decisions, including not offloading the premium cable channel Showtime and striking a deal to sell BET.

The critical view of Bakish came as Paramount, with its heavy reliance on the cable television business, found it increasingly difficult to maintain profits amid the rapid industry transition to streaming. Shares of Paramount’s stock (PARA) have dropped nearly 50% over the last year.

While legacy media companies have struggled immensely in recent years, Paramount, with its vast portfolio of cable outlets including Nickelodeon, MTV and Comedy Central, was greatly exposed to shifting consumer habits with millions of people abandoning cable each year in favor of services like Netflix.

In an attempt to stave off declining cable revenues, Paramount has spent billions of dollars building its own streaming service, Paramount+. But like the platforms of other legacy media companies, it has struggled to gain the necessary traction to supplement linear losses. Part of the challenge for Paramount is its content library is simply not deep enough to persuade enough customers to purchase a monthly subscription in what has become a crowded space. On Monday, the company reported its paid subscriber base had grown to 71.2 million subscribers.

Supporters of the Skydance deal hope that merging Paramount with the Ellison-led company will change its fortunes. Skydance has promised to invest heavily in a combined company, infusing at least $3 billion in cash to pay down debt and purchase stock, a person familiar with the matter told CNN.

Skydance made its “best and final” offer to Paramount on Sunday, the person said. The deal values Skydance at approximately $5 billion.

The offer aims to placate shareholders who have expressed concern with the deal on the table. Those shareholders have argued the deal primarily benefits Redstone and they have encouraged Paramount’s board to evaluate other options. The offer from Skydance would see the company purchase a swath of Paramount shares at a premium price, the person familiar with the matter explained.

If approved, the committee of Paramount executives would then lead the company until the deal is completed and a new permanent leadership team takes the helm. In addition to Ellison, a possible top executive for a merged Paramount-Skydance company would be Jeff Shell, the former NBCUniversal chief executive who was fired last year after a sexual harassment claim was lodged against him.

This story has been updated with additional information.

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