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Paramount and Warner Bros. merger to operate as Skydance in $110 billion deal
The company formed by the merger of Paramount Skydance and Warner Bros. Discovery is expected to begin operating as Skydance Corporation on October 6.
The company to be formed through the merger of Paramount Skydance and Warner Bros. Discovery will be named Skydance Corporation after the transaction is completed. The merger is expected to close on October 6, provided that the required closing conditions are fulfilled.
According to company documents, the transaction values Warner Bros. Discovery at approximately $110 billion on an enterprise-value basis. The Skydance name comes from the film and television production company founded by David Ellison.
Paramount and Warner Bros. brands to remain
The new corporate identity will sit above the Paramount and Warner Bros. brands. The two studios will continue using their existing names and established brands.
Skydance also plans to transfer its Class B common shares from Nasdaq to the New York Stock Exchange. Trading on the New York Stock Exchange is expected to begin on October 6 under the ticker SKYD, replacing the current PSKY ticker.
Studios and streaming platforms to merge
The merger will bring Paramount Pictures and Warner Bros. under the same corporate umbrella. Paramount+ and HBO Max will also be among the new group’s streaming platforms.
Television operations will include CBS, CNN, MTV, TBS, Comedy Central and Food Network. The combined catalogue will include Harry Potter, The Lord of the Rings, Game of Thrones, the DC Universe, Yellowstone, Mission: Impossible, Top Gun and Nickelodeon’s children’s programmes.
Management and financing
David Ellison will serve as chairman and chief executive of the merged group. Ynon Kreiz, the former Mattel executive, will join the company as co-chief executive, with his term scheduled to begin on October 5.
The transaction will be carried out through a financing structure comprising equity, loans, bonds and external investments. Paramount arranged more than $41 billion in dollar-denominated bonds, euro-denominated bonds worth €885 million, and new term loans totaling $8.5 billion and €850 million.
Affiliates of Oracle founder Larry Ellison have committed up to $46.7 billion in equity financing. Investment vehicles linked to the sovereign wealth funds of Saudi Arabia, Qatar and the United Arab Emirates, along with RedBird Capital Partners, are also participating in the financing.
Final obstacles to the merger cleared
Control of the company will rest with David Ellison, Larry Ellison and RedBird founder Gerry Cardinale. The merger will begin with one of the entertainment industry’s largest portfolios of studios, television networks and intellectual property, but integrating two major businesses and managing the high debt burden will be among the new group’s main challenges.
The transaction also concluded the ongoing bidding contest for Warner Bros. Discovery. Paramount won the bidding after outpacing Netflix, which had reached an agreement to acquire Warner Bros.’ studio and streaming operations.
A federal judge removed one of the final obstacles to the transaction on September 30. The judge approved a settlement between Paramount and 12 U.S. states that had sought to block the merger on the grounds that it violated antitrust rules.
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