Paramount Completes $110 Billion Takeover of Warner Bros. Discovery, Creating Skydance

Paramount completed its roughly $110 billion acquisition of Warner Bros. Discovery on Tuesday, ending a nearly eight-month regulatory gauntlet and merging two of Hollywood's oldest studios into a single company, Skydance Corporation, that now controls CBS, HBO, CNN, Paramount+ and a combined library spanning "Top Gun" to "Harry Potter." The closing, confirmed in a filing with the Securities and Exchange Commission, caps a deal that survived a federal antitrust lawsuit from a dozen states, a separate suit from the Writers Guild of America, and foreign-ownership objections that are still unresolved three days after the merger took effect.

Warner Bros. Discovery shareholders received $31.01666668 a share in cash, the company said, a figure that includes a daily "ticking fee" that accrued while the deal's closing slipped past its original third-quarter target. Warner Bros. Discovery stock stopped trading on the Nasdaq on Tuesday; the renamed Skydance Corporation shifted its Class B shares to the New York Stock Exchange under the ticker "SKYD," a move it had registered days earlier in a separate SEC listing filing.

A century of rivalry, folded into one ticker

The combined company describes itself as one of the largest media and entertainment groups in the world, with close to $70 billion in annual revenue, more than 200 million streaming subscribers across platforms, and a portfolio that includes CBS, CBS News, CBS Sports, CNN, TNT Sports, HBO and HBO Max, Paramount+, Pluto TV, Nickelodeon, MTV, Comedy Central, BET, HGTV and Cartoon Network. Financing for the deal included $47 billion in new Class B equity priced at $12 a share, led by the Ellison family, RedBird Capital Partners, Saudi Arabia's Public Investment Fund and the Qatar Investment Authority, alongside roughly $50 billion in new debt arranged by Bank of America, Citigroup and Apollo.

"Today is a historic day, not just for Skydance but for our entire industry," David Ellison, the company's chairman and chief executive, said in the official announcement. "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." Ynon Kreiz, formerly chief executive of Warner Bros. Discovery, becomes co-chief executive. The company has pledged to release at least 30 theatrical films a year, each with a minimum 45-day theatrical window, and says it is targeting more than $6 billion in run-rate cost savings within three years.

• Deal value: roughly $81 billion in equity, about $110 billion including assumed debt
• Payout: $31.01666668 per Warner Bros. Discovery share, in cash
• New company: Skydance Corporation, trading on the NYSE as "SKYD"
• Scale: nearly $70 billion in combined annual revenue, 200 million-plus streaming subscribers
• Pledge: at least 30 theatrical films a year, minimum 45-day theatrical windows

The price of a green light

Getting to Tuesday required Paramount to make concessions to regulators on three continents. The European Commission conditionally cleared the deal in July, requiring Paramount to exit its UIP film-distribution joint venture with Universal across the European Economic Area within 13 months and to forgo any new distribution partnership with Universal in Europe for a decade. Britain's Competition and Markets Authority cleared the transaction in August without referring it for a deeper phase-two inquiry, according to the regulator's published case file, after reviewing its effect on film distribution, television production and children's programming.

The more consequential fight played out in federal court in Oakland, where California Attorney General Rob Bonta led a coalition of 12 states in suing to block the merger under the Clayton Act, arguing it would unlawfully concentrate control over film and cable distribution. The Writers Guild of America filed a parallel suit, contending the deal would weaken writers' bargaining power by shrinking the number of companies competing for scripts. U.S. District Judge Araceli Martínez-Olguín initially paused the transaction and set a trial for March 2027 before the states and Paramount reached a settlement in late September. She approved that consent decree on September 30, clearing the final legal obstacle to closing, according to contemporaneous court reporting. The decree requires Skydance to release at least 30 films annually for two years and 32 a year after that, with $30 million penalties for missed quotas, and to install an editorial-independence board overseeing CBS News and CNN.

Bonta did not describe the outcome as a win for the merger's opponents. "This settlement is not a vote of support for this merger," he told reporters, according to a transcript of his remarks, even as he called it the best course of action available once a trial judge had already allowed the deal to proceed. A coalition of critics organized as Block the Merger called the settlement "toothless."

The scrutiny outlives the closing bell

The deal's completion has not resolved a separate, unanswered question at the Federal Communications Commission: how much of the new company's equity sits in foreign hands. Paramount's own filings put total foreign ownership of the combined company at roughly 49.5 percent at closing, with investors including Saudi Arabia's Public Investment Fund, the Qatar Investment Authority and Abu Dhabi-linked funds. FCC Commissioner Anna Gomez, the agency's lone Democrat, called in a formal statement in May for a "full, independent, and rigorous review" before the Commission approves the foreign-ownership arrangement, which would let Paramount's CBS licensees carry up to 100 percent foreign equity.

"The public airwaves belong to every American, not just billionaire buddies of this Administration and the foreign governments that fund them," Gomez said in the statement, which noted that the Saudi fund is controlled by Crown Prince Mohammed bin Salman, whom U.S. intelligence agencies concluded ordered the 2018 killing of Washington Post journalist Jamal Khashoggi.

The FCC has not issued a ruling on the foreign-ownership petition, and the agency's chairman, Brendan Carr, approved the related transfer of station licenses at the bureau level rather than through a vote of the full Commission — a decision now under challenge. Days before the merger closed, the U.S. Court of Appeals for the District of Columbia ordered the FCC to respond within 30 days to a mandamus petition from the Media and Democracy Project, a nonprofit that is separately contesting the bureau-level approval and renewing a long-dormant challenge to the broadcast license of Fox's Philadelphia station, according to court filings reported this week. "We welcome the Court's order requiring the FCC to respond to our mandamus petition," said Preston Padden, a former Fox Broadcasting executive involved in the challenge.

For now, the deal stands completed. Skydance's advisers on the transaction included Centerview Partners and RedBird Advisors for Paramount and Allen & Company, J.P. Morgan and Evercore for Warner Bros. Discovery, according to closing-day coverage. What remains open is whether the FCC, under continuing pressure from Capitol Hill and now a federal appeals court, will subject the ownership structure that made the deal possible to the review Gomez and congressional Democrats have demanded — a question that could still reshape who ultimately controls CBS and CNN even after Tuesday's closing bell.