Jeffrey Katzenberg Backs David Ellison Amid Paramount Drama

Hollywood Titans Clash Over Future of Paramount Studios

by Zain ul Abedin
Jeffrey Katzenberg Backs David Ellison Amid Paramount Drama
© Kevin Winter/Getty Images

In the ever-evolving drama of Hollywood's corporate machinations, Jeffrey Katzenberg has voiced his support for a potential Paramount-Skydance collaboration, asserting that such a union could herald a significant boon for both Paramount and the broader entertainment industry.

The remarks were made at the Axios BFD Talks: LA, where Katzenberg, a seasoned figure in the industry with a legacy of leadership at DreamWorks and Walt Disney Studios, discussed the intricate dynamics at play. The possibility of David Ellison, CEO of Skydance Media, striking a deal with Paramount has been a topic of keen interest, though complications have arisen.

"There's a reason why the David Ellison deal did not fly, which I think is unfortunate. Because I think David is a phenomenal entrepreneur, and he is super ambitious and loves the movie business, the studio business," Katzenberg noted, emphasizing Ellison's passion and entrepreneurial spirit as key assets that could have greatly benefited Paramount and its stakeholders.

Despite the setback, Katzenberg remains optimistic about Ellison's ongoing involvement, suggesting that the door is not yet closed: "The economic complexity of how this has played out, over decades, makes it really hard to get to a successful outcome.

But not impossible. And I would say don't count Ellison out."

Paramount's Strategic Crossroads

While negotiations have continued past the exclusive window, Paramount's dance card remains full, with alternative offers still on the table.

Notably, a competing bid from Sony and Apollo is under consideration. It promises substantial returns to shareholders but comes laden with its own set of regulatory hurdles, particularly concerning the transfer of broadcast assets.

"Sony can’t own broadcast assets and the idea is that Apollo would take them on. But to assume that the FCC is going to allow a private equity firm to take that license? I mean, just think about that," Katzenberg highlighted, underscoring the regulatory complexities involved.

Amid these high-stakes negotiations, there's yet another path being pondered by Paramount's controlling shareholder, Shari Redstone, who may opt to delay any decision, allowing the company to potentially enhance its standing independently before revisiting such strategic moves.

Ellison, along with investors Larry Ellison and RedBird Capital, has proposed acquiring Redstone’s stake, a move that would keep the company intact and public - a scenario that many in Hollywood favor. Meanwhile, the hefty $26 billion offer from Sony and Apollo, including the assumption of Paramount’s debt to take the company private, continues to attract shareholder interest.