Billionaire investor and money manager Mario Gabelli likes what David Ellison and the Skydance Media team said about their rationale for merging the media and production company with Paramount Global. But at this point, he doesn’t know whether the buyout price Skydance is offering Paramount’s Class A voting shareholders is fair — and he indicated his firm is keeping legal options open if it determines the deal isn’t equitable.

Gabelli is the founder, chairman and CEO of GAMCO Investors, which represents clients who own about 12.5% of the Class A voting shares of Paramount Global.

In an interview with Variety, Gabelli praised the Skydance and Paramount teams for “a fantastic job” in detailing how the combined company could achieve synergies in content production and global distribution and through potential streaming joint ventures. “I’m very impressed with what they said,” Gabelli said.

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Skydance sees at least $2 billion in annualized cost cuts that can be made at the company, much of it from its linear TV business, RedBird Sports & Media chairman Jeff Shell told Paramount investors Monday. Shell, former CEO of NBCUniversal, is slated to be named president of the newly merged entity once the deal closes.

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As of Monday, however, Gabelli said he wasn’t sure how GAMCO would proceed on its clients’ behalf. He said he hasn’t spoken with Shari Redstone — whose National Amusements Inc. owns 77% of Paramount Global’s Class A voting shares — about the Skydance deal.

Under the terms of the Skydance-RedBird offer, Class A stockholders other than NAI are being offered $23 in cash per share or 1.5333 shares of Class B (nonvoting) stock of New Paramount. Redstone’s NAI has agreed to sell the company to the Skydance investor group for $2.4 billion on a cash-free, debt-free basis (i.e. enterprise value), translating to $1.7 billion in equity value.

According to Gabelli, he needs more transparency about the value of National Amusements Inc.’s sale. “I don’t know what Shari got per share” for her interest in Paramount Global, he said.

“What is fair, and why do they try to squeeze out the [Class] A shareholders at the price they selected?” Gabelli asked rhetorically, characterizing the offer as “$23 [per share] or drop dead.” He added that “I’d like to keep the voting stock” in Paramount Global. “I’ve been in it for 40 years!”, said Gabelli, referring to predecessor company Viacom, which Sumner Redstone acquired in 1987.

About the prospect of taking legal action against the Skydance-Paramount deal, Gabelli said, “If we sue them it’s at our expense.”

NAI has delivered “a written consent approving the transaction”; given its controlling stake in Paramount Global, “No further stockholder approval is required” to complete the Skydance-NAI-Paramount transaction, according to the companies. The parties said they expect the deal to close in the first half of 2025.

That said, Gabelli referenced Paramount’s 45-day go-shop window, under which the company has the right to seek a superior offer to Skydance’s. Quoting Yogi Berra, Gabelli said, “It ain’t over ’til it’s over.”

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