Paramount closes Warner Bros. Discovery takeover, creating Skydance media giant

Paramount closed its takeover of Warner Bros. Discovery on Tuesday, creating a renamed media conglomerate called Skydance and ending a 10-month pursuit that survived a bidding war with Netflix, an antitrust lawsuit by 12 US states and a last-minute Supreme Court challenge.

The combined company began trading on the New York Stock Exchange under the ticker "SKYD," while Warner Bros. Discovery shareholders will receive about $31 per share in cash. Warner Bros. Discovery shares have stopped trading on the Nasdaq.

The transaction is valued at about $81 billion, or roughly $110 billion including debt, according to DW and the Associated Press; CNBC put the enterprise value at an estimated $110 billion. The deal unites two of Hollywood's oldest studios — Paramount Pictures and Warner Bros. Pictures — along with the CBS News and CNN networks, the HBO and CBS television brands, the Paramount+ and HBO Max streaming services and a large set of cable channels. According to CNBC, the combined company controls nearly one-third of basic cable programming. Skydance said it has more than 200 million streaming subscribers and nearly $70 billion in annual revenue, and is targeting more than $6 billion in cost savings within three years, mainly from technology, marketing, procurement and real estate.

"Today is a historic day, not just for Skydance but for our entire industry," said David Ellison, who will serve as chairman and CEO. Ynon Kreiz, the former Mattel chief, is co-CEO overseeing day-to-day operations and integration. Ellison has said the company plans to merge Paramount+ and HBO Max into a single streaming service over time, and that the combined company will allow Paramount and Warner Bros. to remain distinct brands, according to CNBC.

The deal is backed by $47 billion in new equity led by the Ellison family, private equity firm RedBird Capital and the sovereign wealth funds of Saudi Arabia, Qatar and Abu Dhabi, France 24 reported. The Economic Times reported that the Saudi Public Investment Fund and the Qatar Investment Authority were among the investors, and that the US Federal Communications Commission allowed foreign investors to hold up to 100% of the company's indirect equity without voting rights — a move the commission's only Democratic member, Anna Gomez, called alarming and unprecedented. The Ellison family holds the largest equity stake in Skydance, and billionaire Oracle founder Larry Ellison provided major funding and a guarantee to lenders backing the deal, France 24 reported. The company said the Ellison family and RedBird hold all of its voting shares, according to The Economic Times.

The closing capped a turbulent takeover process. Warner Bros. Discovery opened the door to a sale in December, initially agreeing to sell its studio and streaming businesses to Netflix, according to The Economic Times. Paramount then made a hostile bid for the whole company, including CNN and the Discovery networks. Warner's board stood by Netflix at first, the report said, but changed course when Paramount offered $31 per share for all of Warner, calling it the superior bid. Netflix walked away on February 26, and Warner signed a merger agreement with Paramount the next day.

Regulators in nearly 70 jurisdictions cleared the deal, including the US Justice Department, and Paramount said on August 14 that all required approvals were in hand, The Economic Times reported. The Trump administration approved the deal in June without demanding changes, France 24 reported, and the Department of Justice gave its approval on June 12, according to CNBC. European Union antitrust regulators approved the acquisition on July 22, with Paramount agreeing to divest its stake in United International Pictures in Europe and pledging not to enter film distribution deals with Universal in Europe for 10 years, CNBC reported.

The deal drew opposition from across Hollywood and Washington. In April, thousands of actors, writers and directors signed an open letter against the merger — including Jane Fonda, Mark Ruffalo, Denis Villeneuve and J.J. Abrams — while director James Cameron backed Ellison, The Economic Times reported. Critics warned of job cuts in a Hollywood already under pressure and fewer films produced each year, and news media groups feared CNN's independence could be compromised, according to France 24. CNN became part of the political debate as well: according to an Associated Press timeline cited by The Economic Times, President Donald Trump said in December that CNN should be sold, and in March Defense Secretary Pete Hegseth said the sooner Ellison took over the network, the better. The same report noted that Ellison attended a UFC event on the White House lawn in June for Trump's 80th birthday, two days after the US Justice Department said it would not step in. Ellison has said CNN will keep its editorial independence.

Twelve Democratic state attorneys general, led by California's Rob Bonta, sued to block the deal on July 13. A federal judge ordered a halt on July 20, just as the companies were preparing to close, The Economic Times reported, and Paramount subsequently agreed to delay closing to as late as June 2027, according to CNBC. The two sides settled on September 21; Judge Araceli Martínez-Olguín approved the settlement on September 30, calling it a fair, reasonable and good-faith way to address the harms the states had raised.

The settlement requires at least 30 films a year in theaters for the first two years, rising to 32 a year for the next three, a 45-day theatrical window for each film, separate negotiations for Paramount's and Warner's basic cable channels, and a new editorial independence board for CNN and CBS News, The Economic Times reported. The Writers Guild of America, which had filed its own suit, also settled with Paramount last week, the outlet said, while Colorado and Washington did not sign the editorial board terms and critics called the terms too weak.

The final hurdle came on Monday, when four petitioners describing themselves as Paramount customers asked the US Supreme Court to stop the deal. Justice Elena Kagan denied the request without comment.

According to CNBC, Ellison and Kreiz announced their leadership team on October 5, with Bari Weiss and Mark Thompson over CBS News and CNN respectively, and Casey Bloys, George Cheeks and JB Perrette overseeing the streaming and TV businesses. CBS Sports chief David Berson will take over Skydance's global sports group, CNBC said. Mark Thompson and Bari Weiss are staying in their current roles, The Economic Times also reported.

Skydance said it expects the integration to affect jobs across Hollywood, and is aiming to bring debt down to three times earnings by the end of 2029 and generate more than $10 billion in free cash flow by 2030, according to The Economic Times.