Paramount Completes $81bn Takeover of Warner Bros, Creates Hollywood Giant Skydance

Paramount has completed its $81 billion takeover of Warner Bros. Discovery, bringing two of Hollywood’s biggest entertainment companies under one corporate roof and creating a new media giant known simply as Skydance.

The transaction closed on Tuesday, October 6, following regulatory approvals and the settlement of legal challenges that had threatened to delay the merger. Warner Bros. Discovery shares have ceased trading on the Nasdaq, while the combined company has begun trading on the New York Stock Exchange under the ticker “SKYD.”

The deal brings together two of the industry’s most recognisable film studios and an extensive collection of entertainment, television, news and sports properties.

The combined portfolio includes Warner Bros. titles and franchises such as Harry Potter, DC Studios and The White Lotus, alongside Paramount properties including Mission: Impossible, Top Gun and SpongeBob SquarePants. It also puts HBO Max and Paramount+ under the same corporate umbrella, while CNN and CBS News will operate within the same company.

Skydance will be led by David Ellison, the billionaire son of Oracle co-founder Larry Ellison, who will serve as chief executive. Former Mattel chief executive Ynon Kreiz has been named co-CEO and is expected to oversee much of the company’s day-to-day operations, while Ellison focuses heavily on strategy and creative direction.

The completed transaction is the culmination of a lengthy and closely watched battle for Warner Bros. Discovery. Paramount’s pursuit followed a bidding contest involving Netflix, which had initially reached an agreement for Warner Bros.’ studio and streaming operations before Paramount increased its offer and pursued the entire company.

The transaction is valued at $81 billion on an equity basis, while the overall value rises to nearly $111 billion when debt is included. The new company is expected to carry about $80 billion in debt, increasing pressure on management to improve streaming performance, maintain theatrical success and reduce costs.

Skydance says it is targeting at least $6 billion in annual cost savings within three years. The company also plans to combine its streaming operations and maintain a substantial theatrical film slate, with a commitment to release at least 30 films annually. It says its television operations already encompass more than 180 shows and series.

The merger has also raised concerns about jobs and competition in an industry already under pressure from declining traditional television audiences and the enormous cost of competing in streaming.

Hollywood writers and other industry groups had raised objections to the merger, warning that further consolidation could reduce employment opportunities and choices for audiences. Legal challenges were also brought by a coalition of US states on antitrust grounds. Those disputes were resolved through settlements that cleared the final path for the acquisition.

The new ownership also puts two major US news organisations, CNN and CBS News, under the same corporate parent. CNN Editor-in-Chief Mark Thompson will remain in his position, while CBS News continues under Editor-in-Chief Bari Weiss.

As part of a settlement with state attorneys general, Skydance agreed to establish a News Editorial Independence Board to oversee commitments concerning editorial independence at CNN and CBS News. The arrangement has nevertheless attracted criticism from some opponents of the merger.

Skydance says the enlarged company will reach audiences in more than 200 countries and territories and have more than 200 million streaming subscribers across its platforms. Its leadership has described the merger as an attempt to build a technology-driven global entertainment company capable of competing with Netflix, Disney, Amazon, Apple and other major players.

The completion of the takeover marks one of the biggest transformations in Hollywood’s corporate landscape in years, combining an enormous catalogue of films, television programmes, sports rights, news operations and streaming services under a single company.