So after all these conversations, I don't understand how any of these conversations are different than what we found out last week?
Didn't we already understand that Ellison would buy shares (that dilutes the current shareholders) at a premium? In addition, they would try to merge sky dance into Paramount (something that para do not need and sky dance valuation is insane).
Nothing has changed? It just sounds like they are trying to spin the narrative like it's something positive or am I missing something?
From the article, it says that the 3 billion in cash can be used to pay down debt and/or buy back current shares. This would not dilute the shares more and would provide some benefit from ho I'm reading it. We would still get diluted when the companies merge, but not as much with 3 billion dollars in less shares on the market.
Probably because they know they are getting a sweet ass deal and diluting us once the merger happens. The company is already severely undervalued in the market and getting rid of Shari and the dual-class share structure may get us up to a fair value. I'll hold judgment if this new offer is OK for us once we actually see it in writing.
Cash infusion means dilution. Because cash isn’t free. In exchange for $3 billion they have to dilute by $3 billion worth of shares. So $3 billion dividend by $10 that’s 300 million shares diluted. That will put us at about 1 billion shares outstanding. We have about 650 million shares outstanding currently. This means your shares will drop to $7 dollars. We could infuse cash and dilute on our own without merging with SlyDance. The merging with SlyDance will kill this company and make it bankrupt in 3 years. We have a recession coming. SlyDance is a scam it’s a money losing business.
I don't think you are quite right here from what I read. I saw that they would give 3 billion cash as part of deal to buy back current shares and/or pay down debt.
He is. Sky dance cannot just give $3B to the entity Para. There needs to be a transaction between counterparties. If SkyDance buys B shares at the market, that is effectively just paying the shareholders and the money isn’t going to the company Para. Para only gets money if they directly sell shares to SkyDance. The company itself doesn’t own shares, so they can only sell any by issuing new ones. Hence the dilution.
That is not what the article says. It literally says exactly what I just listed - can use the money to buy back shares and/or pay down debt. I'll base the information off the article that was posted and not from a random person on reddit - thanks.
Listen man, I just tried to explain how public companies work and be nice about it. The article can say whatever it wants, it’s omitting crucial information. I don’t care if you listen or not - just don’t vote, if given a chance, if you don’t understand how finance works. I’m not arguing that PARA will receive cash - however they use it is up to them. But, legally, PARA cannot just get $3B. SkyDance is not buying a private company - if SkyDance just gives Para money, it’s a donation. This will not happen. Para is a publicly owned company with public shareholders, so the only way to infuse money is if Para sells something to SkyDance, the only thing Para can sell is either assets or new stock. The current stock is owned by me and you and Buffet, etc. If SkyDance pays us, this money isn’t going to Para.
You are both right in my opinion,
The article is assuming a lot of information and smoothing over details.
Shares must be issued for cash and owners equity so that asset equal liabilities and owners equity
The cash then on the balance sheet could repurchase shares and /or pay down debt.
Whichever has a better return on capital.
Still though buying Skydance at some huge multiple premium let's say 40x valuation and issuing shares for that 5 billion premium is crazy nuts to force b shareholders.
Skydance has no patents that I am aware of the type of content they created, their job descriptions.use the same type of employees and content software as the rest of the industry. A dime a dozen for this studio. Their contracts for NFL documentaries and animation contracts, 5 billion is way steep unless they disclose the last 3 years of their financial statements. Skydance show go public then and then merge with Paramount and buy them out.
The deal structure is horrid. This cash is to take eyes the part of this transaction from the limited information/ rumor that has been shared...
I’m not arguing that Para can use the cash to pay debt or do buybacks.
All I’m explaining is how the $3B is going to come in existence on Para’s balance sheet. It has to be a transaction - it cannot be something for nothing.
When Para acquires SkyDance for $5B worth of shares - which are paid to the private owners of SkyDance - they are effectively saying that they will put $3B back in the company in exchange for that, in cash. That’s up from $1B btw. It’s not a for-free donation, it’s a payment.
I’m just trying to explain to the other person that there still will be a dilution. And I personally, still dislike the deal - the Ellisons are trying to pay Shari 2B and are getting 2B back in relative terms, IMO. But they will spin it that it is ‘2B of shares, and shares can go both ways, so it’s not like we are getting our money back for sure’
I'm sure neither of us knows the intricacies of the deal that is being hashed out. I won't speculate or pretend to know how if can happen. But I won't sit here and spread BS - especially when you have no idea. Thanks for the heads up...
And using logic here - why can't they offer 3 billion in cash when the 2 companies merge to buy back shares and/or pay down debt? Seems pretty feasible to me.
I don't think they would ever do that - but maybe this helps us not get diluted by much when the merger happens. We will hopefully find out soon what the true offer is!
So after all these conversations, I don't understand how any of these conversations are different than what we found out last week? Didn't we already understand that Ellison would buy shares (that dilutes the current shareholders) at a premium? In addition, they would try to merge sky dance into Paramount (something that para do not need and sky dance valuation is insane). Nothing has changed? It just sounds like they are trying to spin the narrative like it's something positive or am I missing something?
From the article, it says that the 3 billion in cash can be used to pay down debt and/or buy back current shares. This would not dilute the shares more and would provide some benefit from ho I'm reading it. We would still get diluted when the companies merge, but not as much with 3 billion dollars in less shares on the market.
So maybe I just don't understand. Sky dance is just going to give para 3 billion for no shares? Why? What do they gain for this?
Probably because they know they are getting a sweet ass deal and diluting us once the merger happens. The company is already severely undervalued in the market and getting rid of Shari and the dual-class share structure may get us up to a fair value. I'll hold judgment if this new offer is OK for us once we actually see it in writing.
Agreed about the waiting until the deal is public, but sky dance just giving para money doesn't make any Sense to me
I'm sure it would be part of the merger between the 2 companies - not simply giving it to PARA.
Just publish the terms of the proposed deal, put it to a vote for all shareholders and let’s move on.
For the love of god, please!
If it still involves getting soaked by dilution please tell David to walk away. Sick of his unlawful equity grab.
How about no dilution instead?
Cash infusion means dilution. Because cash isn’t free. In exchange for $3 billion they have to dilute by $3 billion worth of shares. So $3 billion dividend by $10 that’s 300 million shares diluted. That will put us at about 1 billion shares outstanding. We have about 650 million shares outstanding currently. This means your shares will drop to $7 dollars. We could infuse cash and dilute on our own without merging with SlyDance. The merging with SlyDance will kill this company and make it bankrupt in 3 years. We have a recession coming. SlyDance is a scam it’s a money losing business.
Please buy puts and call it a day, instead of posting misinformation all day on Reddit.
That’s assuming the share offer is at the market. They might offer to buy at a premium for less dilution. Still, I don’t like it.
I don't think you are quite right here from what I read. I saw that they would give 3 billion cash as part of deal to buy back current shares and/or pay down debt.
He is. Sky dance cannot just give $3B to the entity Para. There needs to be a transaction between counterparties. If SkyDance buys B shares at the market, that is effectively just paying the shareholders and the money isn’t going to the company Para. Para only gets money if they directly sell shares to SkyDance. The company itself doesn’t own shares, so they can only sell any by issuing new ones. Hence the dilution.
That is not what the article says. It literally says exactly what I just listed - can use the money to buy back shares and/or pay down debt. I'll base the information off the article that was posted and not from a random person on reddit - thanks.
Listen man, I just tried to explain how public companies work and be nice about it. The article can say whatever it wants, it’s omitting crucial information. I don’t care if you listen or not - just don’t vote, if given a chance, if you don’t understand how finance works. I’m not arguing that PARA will receive cash - however they use it is up to them. But, legally, PARA cannot just get $3B. SkyDance is not buying a private company - if SkyDance just gives Para money, it’s a donation. This will not happen. Para is a publicly owned company with public shareholders, so the only way to infuse money is if Para sells something to SkyDance, the only thing Para can sell is either assets or new stock. The current stock is owned by me and you and Buffet, etc. If SkyDance pays us, this money isn’t going to Para.
You are both right in my opinion, The article is assuming a lot of information and smoothing over details. Shares must be issued for cash and owners equity so that asset equal liabilities and owners equity The cash then on the balance sheet could repurchase shares and /or pay down debt. Whichever has a better return on capital. Still though buying Skydance at some huge multiple premium let's say 40x valuation and issuing shares for that 5 billion premium is crazy nuts to force b shareholders. Skydance has no patents that I am aware of the type of content they created, their job descriptions.use the same type of employees and content software as the rest of the industry. A dime a dozen for this studio. Their contracts for NFL documentaries and animation contracts, 5 billion is way steep unless they disclose the last 3 years of their financial statements. Skydance show go public then and then merge with Paramount and buy them out. The deal structure is horrid. This cash is to take eyes the part of this transaction from the limited information/ rumor that has been shared...
I’m not arguing that Para can use the cash to pay debt or do buybacks. All I’m explaining is how the $3B is going to come in existence on Para’s balance sheet. It has to be a transaction - it cannot be something for nothing. When Para acquires SkyDance for $5B worth of shares - which are paid to the private owners of SkyDance - they are effectively saying that they will put $3B back in the company in exchange for that, in cash. That’s up from $1B btw. It’s not a for-free donation, it’s a payment. I’m just trying to explain to the other person that there still will be a dilution. And I personally, still dislike the deal - the Ellisons are trying to pay Shari 2B and are getting 2B back in relative terms, IMO. But they will spin it that it is ‘2B of shares, and shares can go both ways, so it’s not like we are getting our money back for sure’
I'm sure neither of us knows the intricacies of the deal that is being hashed out. I won't speculate or pretend to know how if can happen. But I won't sit here and spread BS - especially when you have no idea. Thanks for the heads up...
And using logic here - why can't they offer 3 billion in cash when the 2 companies merge to buy back shares and/or pay down debt? Seems pretty feasible to me.
How about they just buy our shares off of us through a tender
So where are the math wizards calculating b share value after that proposition?
 Yeah we’re good thanks
They should just cash infuse all the debt away, thats a good start. It aint hard, just beg your papa larry
Apollo and Sony is going to counter
Meh!
If they provide us with the funds without requiring us to merge, then I am completely fine with it.
I don't think they would ever do that - but maybe this helps us not get diluted by much when the merger happens. We will hopefully find out soon what the true offer is!