Paramount (PARA, PARAA) has reportedly agreed to the terms of a deal to merge with Skydance Media. MoffettNathanson Senior Research Analyst Robert Fishman joins Catalysts to break down how investors should digest the move.

The media giant announced several new measures at its annual meeting, from job cuts to streaming opportunities, which Fishman explains comes at "an awkward time" amid the Skydance deal uncertainty. The company's controlling shareholder, Shari Redstone, ultimately has the final say on the deal, Fishman explains: "It's possible that there's a deal in place already, so it should be known within the next few days — I think is what the reporting suggests — whether Shari wants to go forward or not. But this alternative scenario with the office of the CEO and the updated plan that was laid out today would probably be the marching orders if Shari decides not to go forward with Skydance for whatever reason."

He notes that regardless of a deal, Paramount should remain focused on cost-cutting measures "given the pressures of the revenue and cord cutting, and even more so, advertising recently as secular challenges for the entire TV ecosystem continue to emerge and get worse." He reiterates that the annual meeting has laid out the company's plans if the deal falls through. However, he sees the deal crossing the finish line as a "more likely" outcome.

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This post was written by Melanie Riehl