Paramount and Skydance have called off their merger talks

Paramount Global stock fell almost 8% late Tuesday after news broke that talks about a potential merger with Skydance Media, the movie studio behind Top Gun: Maverick, had fallen apart.

The Wall Street Journal, citing unnamed sources familiar with the matter, reported that Shari Redstone — the head of the holding company behind Paramount — has ended discussions with Skydance after the two parties failed to iron out the final terms of a deal.

CNBC reported earlier this month that a committee of Paramount’s independent directors and Skydance’s buying group, which included the private equity firms RedBird Capital Partners and KKR, had agreed to terms of a deal. Under the most recent proposed deal, reported by The Journal, Skydance would have acquired Redstone’s National Amusements for about $1.7 billion. Skydance, led by David Ellison, the son of Oracle co-founder and billionaire Larry Ellison, also agreed to merge the movie studio with Paramount in a stock deal.

Among the final issues the two parties couldn’t agree upon was whether all shareholders would be allowed to vote to approve the transaction. Skydance said such a vote would be nonstarter, The Journal reports. National Amusements also wanted Skydance to agree to provide legal protection in the event shareholders sued over the deal, The New York Times reports.

Paramount’s committee was scheduled to vote on the merger Tuesday afternoon, though it was unclear if that vote had occurred.

Paramount declined to comment and National Amusements did not immediately respond to a request for comment.

National Amusements has already received interest from two other buyers, The Journal reports, including an investor consortium headed by Hollywood producer Steven Paul and media executive Edgar Bronfman Jr., and backed by Bain Capital. Quartz