Paramount-Warner merger closes, creating new media company Skydance

New entity starts with $80 billion in debt, layoffs expected

The merger of Paramount Skydance and Warner Bros. Discovery officially closed Tuesday, creating Skydance, which will be the parent company of two major studios, television networks including CBS, CNN, Comedy Central, MTV and TBS, and streaming services Paramount+ and HBO Max.

Last week, Paramount CEO David Ellison announced the combined company will be named Skydance. The new company will begin trading on the New York Stock Exchange Tuesday as SKYD. WBD shares have been discontinued on Nasdaq.

Under the terms of the agreement, WBD shareholders received an amount in cash equal to $31.02 per share. The deal, valued at $111 billion, took many months to close.

It began with a bidding war against Netflix for WBD, with WBD accepting Netflix’s offer on Dec. 5. Soon after, Paramount launched a hostile bid to buy WBD, but the board wasn’t interested. Then, Paramount announced that billionaire Oracle creator Larry Ellison would back the deal with $40 billion in equity. On Jan. 20, Netflix changed its offer to all cash, then on Feb. 10, Paramount did the same and added some extras.

Netflix granted WBD a seven-day pause to evaluate Paramount’s offer, and during that time, Paramount raised the bid even more to $31 per share. In late February, Netflix ceded defeat to Paramount.

David Ellison, 43, is running the new company as chair and CEO. Ellison has hired Ynon Kreiz, former CEO of Mattel, to run the company as co-CEO. Ellison announced the senior leadership team for Skydance on Monday.

“Today is a historic day, not just for Skydance but for our entire industry,” David Ellison said in a statement. “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. We couldn’t be more excited to get to work.”

The new company starts with $80 billion in debt. Skydance will likely reduce expenses through mass layoffs, with thousands of employees at the former Paramount and WBD expected to lose their jobs in the coming months, Variety reported.