The negotiations mean entertainment giant Paramount will not speak with Apollo or other prospective acquirers for 30 days, while it aims for a transaction to be bought by Skydance, according to the Wall Street Journal, which cited unnamed sources.

Shares of Paramount, which owns television networks CBS and MTV and whose chair is Shari Redstone, surged 15% on Wednesday.

Paramount declined comment while Skydance did not immediately respond to a request from AFP.

Investment giant Apollo Global Management told Paramount that it would offer more than US$26 billion for Paramount, including debt, but Paramount chose not to engage because of the Skydance talks, the New York Times reported.

Paramount’s studio division has long been eyed for purchase, with streaming television titan Netflix among companies that have expressed interest in the operation.

Paramount and Skydance jointly produced Top Gun: Maverick, the Tom Cruise blockbuster.

Formerly known as ViacomCBS, Paramount Global’s holdings also include Nickelodeon and Comedy Central.

Privately held Skydance Media is led by David Ellison, the son of billionaire Oracle co-founder Larry Ellison.