In a bold move to expand his empire, media mogul Byron Allen has placed a significant proposal to purchase Paramount Global’s outstanding shares for $14.3 billion. The bid involves a 50% premium to acquire the voting shares for $28.58 each and non-voting shares for $21.53 each. If the deal is approved, Allen Media Group will acquire Paramount’s $15 billion debt which will increase the bid value to approximately $30 billion.
“Mr. Byron Allen did submit a bid on behalf of Allen Media Group and its strategic partners to purchase all of Paramount Global’s outstanding shares. We believe this $30 billion offer, which includes debt and equity, is the best solution for all of the Paramount Global shareholders, and the bid should be taken seriously and pursued,” Allen’s spokesperson said in a statement.
Allen has expressed interest in acquiring other media groups in the past. As previously reported by BlackStars News, he submitted a $3.5 billion offer for BET Media Group in December following reports of a prospective below-market deal. He has now altered course and is in pursuit of BET’s parent company, Paramount Global. He also bid $10 billion for Disney’s flagship ABC broadcast network and other properties but the conglomerate later said it wasn’t looking to sell. It is quite clear from these transactions that Allen seeks to acquire a foothold in legacy media.
Legacy media are the mass media institutions that dominated print media, film studios, music studios, advertising agencies, radio broadcasting, and television before the internet became popular. It spans from audio to visual media and includes conglomerates such as Paramount Global, Disney, Warner Media, and NewsCorp., among others. However, with the advent of the internet, streaming and content digitization, the media landscape has changed over the past two decades. Allen Byron’s bid to acquire Paramount Global has far-reaching ramifications for the future of legacy media and the Black community in general.
The turnaround King
Paramount experienced a 30 percent decline in operating income last year, with sales remaining constant at $22 billion. Sources close to Allen state that he already has a plan lined up to run the entertainment company on a more cost-efficient basis. He intends to sell the Paramount film studio, real estate and some intellectual property and keep the TV channels, including the Paramount+ streaming service.
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A comic turned entrepreneur, Allen is exceptionally qualified to turn around Paramount’s fortunes. Starting from his living room, he has built the largest independent distributor and producer of first-run syndicated programming worldwide. His impact on Paramount can already be felt with the company’s stock rising to nearly 8% from a 52-week low of $10 following news of the proposed deal.
Black generational wealth
Legacy media conglomerates are often owned and inherited between families. Even with the emergence of the internet, traditional media remains predominant in economics and political structures. Allen’s acquisition of Paramount from the Redstone family, owners of a global media empire would be historic and set the pace for Black people in business.
It has the capacity to not only create opportunities for his lineage but also lay the foundation from which coming generations can benefit from Black wealth. A trendsetter, Allen made history in 2018 when he acquired The Weather Channel for $310 million, becoming the first Black American to own a 24-hour mainstream cable news network. The Paramount transaction could be another occasion to advance Black excellence.
Representation in Legacy Media
Media branding is all about trust. Consumers have to trust the faces and voices that deliver their content and programming. The public’s willingness to trust large institutions has elicited the recent downturn in legacy media. The representation of African Americans in mainstream media remains a major concern with the view that African-American ownership in the media would change the status quo being prevalent. As many look for alternative sources of news and entertainment, Allen’s pending ownership of Paramount would be a massive coup.
The television industry misses out on the Black dollar by telling fewer Black-led stories and consistently underfunding and undervaluing them. Research by McKinsey shows that the industry could reap an additional $10 billion in annual revenues by addressing the prevalent racial inequities. Black-owned legacy media has the power to transform the experience of Black professionals working across the film and TV ecosystem ranging from studios, networks, production and streaming companies, and distributors.