Los Angeles — Paramount and Warner Bros. Discovery have officially completed their $111 billion merger, bringing the two entertainment companies together under a newly combined Skydance Corp. led by chairman and CEO David Ellison.
The transaction, which includes the assumption of Warner Bros. Discovery debt, combines two major Hollywood studios, television networks including CBS, CNN, Comedy Central, MTV and TBS, and streaming platforms Paramount+ and HBO Max. Skydance said the merged company will generate nearly $70 billion in annual revenue, while carrying approximately $80 billion in net debt.
The closing comes just over a year after Ellison’s Paramount Skydance, formed in 2025 following his Skydance Media acquisition of Paramount Global, launched its effort to acquire Warner Bros. Discovery. The 43-year-old executive faced several hurdles during the process, including a competing Netflix agreement involving Warner Bros. assets and an antitrust lawsuit brought by 12 Democratic attorneys general. The deal has now been completed.
The Ellison family, backed by multibillion-dollar support from David Ellison’s father, tech mogul Larry Ellison, holds the largest equity position in Skydance. The Ellisons and investment firm RedBird Capital Partners are the sole holders of Paramount Class A common stock, representing 100% of the combined company’s voting shares.
Skydance Class B shares will begin trading Tuesday on the New York Stock Exchange under the ticker “SKYD.” Under the merger agreement, Warner Bros. Discovery shareholders received cash equal to $31.01666668 per share. WBD shares stopped trading on Nasdaq effective Tuesday.
“Today is a historic day, not just for Skydance but for our entire industry,” Ellison said in a statement.
The CEO added: “From the start, our ambition was to bring these two storied studios together and create a stronger competitor, with the talent, resources, and reach to tell great stories in every genre, on every platform, for audiences everywhere. Now that ambition is a reality…. Our focus now turns to the future: building a company that empowers creatives, entertains audiences and rewards shareholders.”
The merger was financed with $47 billion in investment in Class B common stock, led by Larry Ellison, RedBird Capital Partners, LionTree and sovereign wealth funds from Saudi Arabia, Qatar and Abu Dhabi. The equity investment was priced at $12 per share. Bank of America, Citigroup and Apollo Global Management led the debt financing for the transaction.
Ellison has appointed Ynon Kreiz, the former CEO of Mattel, as co-CEO. Ellison announced the new Skydance senior leadership team on Monday.
Skydance also reaffirmed its broader strategy, saying consumers should see greater innovation from a company designed with technology at its core. The company said Paramount+ and HBO Max’s direct-to-consumer streaming offerings will eventually be combined into a single service.
The new Skydance is targeting more than $6 billion in annualized “run-rate synergies” during the next three years. The company said it plans to use the same operational approach that helped Paramount exceed its synergy goals after the Skydance-Paramount merger.
According to Skydance, the majority of savings from the Paramount-WBD combination will come from technology, integration and procurement, marketing, and real estate rationalization. The company said those reductions will make the business “leaner and more nimble,” allowing it to increase spending on stories, creators and technology. Some experts, however, have questioned whether those savings can be achieved without harming operations.
The company also expects significant workforce reductions, with thousands of employees from the former Paramount and WBD expected to lose their jobs over the coming months.
Skydance expects to lower its net debt-to-adjusted EBITDA ratio from an estimated 7x in 2026 and ’27 to 3.0x by the end of 2029.
As part of the agreement to acquire Warner Bros. Discovery, Paramount incurred a ticking fee of roughly $7 million per day payable to WBD beginning Oct. 1. Paramount had expected the transaction to close before Sept. 30, but the antitrust lawsuit involving 12 states pushed back the completion. As a result, Paramount paid Warner Bros. Discovery investors an additional $41.9 million under the ticking-fee arrangement.
Skydance will operate through three divisions: Studios, Direct-to-Consumer and TV Media. Its combined portfolio includes Paramount Pictures, Warner Bros., HBO and HBO Max, Paramount+, Pluto TV, CBS, CNN, CBS Sports, TNT Sports, Nickelodeon, Cartoon Network, MTV, Food Network, BET, HGTV and Comedy Central.
Original article
Comments