Iconic Hollywood studio Paramount to merge with David Ellison's Skydance

Paramount Global board has approved the plan to merge with independent film studio Skydance Media. Under the deal, Paramount's non-executive chair Shari Redstone will sell her family's controlling stake in the company in a transaction that will result in a new firm worth around $28bn (£21.9bn), claimed reports.

The deal announcement comes weeks after Redstone abruptly called off negotiations with Skydance on June 11.

A final agreement is yet to be announced. The merger would combine Paramount, with its namesake film studio and CBS, MTV and Nickelodeon television networks, with its financial partner on several major film releases, including "Top Gun: Maverick", "Mission: Impossible -Dead Reckoning" and "Star Trek Into Darkness".

David Ellison, the 41-year-old son of Oracle billionaire Larry Ellision, founded Skydance in 2010. He will now become Chairman and CEO of the new Paramount. Jeff Shell, former CEO of NBCUniversal, will be its new President.

Under the agreement, Skydance will invest around $8bn in Paramount, including paying $2.4bn for National Amusements, which controls the group. National Amusements owns just 10% of Paramount Group's shares but accounts for almost 80% of its voting rights, said a BBC report.

Paramount said it expected to close the deal by the summer of next year.

According to Ellison, the goal of the deal is to position the “new Paramount” as a “tech hybrid, to be able to transition to meet the demands and needs of the evolving marketplace.

“Given the changes in the industry, we want to fortify Paramount for the future, while ensuring that content remains king,” Shari Redstone, Chairwoman of Paramount and National Amusements, said in a statement.

It is to be noted that in April, Paramount's CEO Bob Bakish left the company after clashing with Redstone over the planned Skydance deal.