Paramount Closes $110B Warner Bros. Takeover: Hollywood’s Newest Giant Is Called Skydance

BURBANK

It’s official: Hollywood has a new giant, and it isn’t called Paramount or Warner Bros. Paramount announced Tuesday that it has completed its takeover of Warner Bros. Discovery — $81 billion in equity, about $110 billion including debt, per TechCrunch and Reuters — to create a combined company called Skydance. The deal, one of the biggest mergers of all time, puts HBO Max and Paramount+, CNN and CBS, MTV, TBS, Comedy Central and Food Network under one roof, alongside franchises from Harry Potter and Game of Thrones to Top Gun and Mission: Impossible. CEO David Ellison called it “a historic day, not just for Skydance but for our entire industry,” and said the company’s focus is now “building a company that empowers creatives, entertains audiences and rewards shareholders.”

Read the shareholder-facing language of that statement against the employee-facing language of Tuesday’s internal memo, and you get the merger in miniature: optimism for the owners, warnings for the workers. Ellison and his new co-CEO, Ynon Kreiz, told staff that “integrating two companies will bring change, including difficult decisions that affect our workforce,” per Variety via the New York Post. The combined company is targeting $6 billion in cost cuts over three years — and everyone in Hollywood knows what that sentence means.

The deal by the numbers$81 billion in equity, $110 billion all-in

The headline number depends on who’s counting. The New York Post puts the equity value at $81 billion; TechCrunch and Reuters peg the all-in figure at roughly $110 billion including debt. The deal was backed by $47 billion of equity investment led by the Ellison family, RedBird Capital, Saudi Arabia’s Public Investment Fund, the Qatar Investment Authority and LionTree, with Bank of America, Citigroup and Apollo leading the debt financing. The Ellison family — David and his father, Oracle co-founder Larry Ellison — is Skydance’s largest shareholder.

Shareholders on the Warner side got out with cash: roughly $31.02 a share, per the merger agreement, and Warner Bros. Discovery shares ceased trading on the Nasdaq on Tuesday. Skydance’s Class B shares began trading on the New York Stock Exchange the same day under the ticker SKYD — a move off the Nasdaq that’s small in symbolism but telling: this is a company that wants to be priced like an old-Hollywood studio stock, not a tech darling. The new company says it will post nearly $70 billion in annual revenue and generate more than $10 billion in free cash flow by 2030, with more than 200 million streaming subscribers across its platforms.

The road hereNetflix lost the bidding war

Getting to Tuesday took a bruising year. Warner Bros. had initially accepted an offer from Netflix — the streamer was its preferred partner — before Paramount muscled in with a higher-value bid in February. Paramount sweetened the pot with a promise of additional cash to shareholders if the deal failed to close by a specified deadline, and agreed to cover the breakup fee Warner Bros. owed Netflix for walking away from its existing agreement.

Then came the ticking fee: Paramount’s offer required Ellison to pay $7 million for each day the deal remained incomplete after October 1. The close landed days after the deadline, leaving it unclear whether he’ll have to pay the roughly $28 million penalty — a rounding error on a $110 billion deal, but a fitting epitaph for a merger that refused to close on schedule.

The concessionsWhat Ellison gave up to get it done

The deal’s final hurdles were political, not financial. California Attorney General Rob Bonta and 11 other state attorneys general sued to block the merger, warning it could crush competition, raise consumer prices, limit choices and hurt workers. A Hollywood writers union piled on. Ellison cleared them with a settlement package that reads like a production mandate: at least 30 high-quality theatrical films a year and an additional $1.5 billion in domestic production spending over the next five years.

There’s also an editorial-independence dimension that’ll be watched closely. The settlement promises external editorial independence boards at both CBS News and CNN, though the details of those boards’ powers haven’t been made public — and journalists at CNN have been openly anxious about what an Ellison-owned newsroom looks like. The merger also needed regulatory sign-off from the Trump administration’s Department of Justice plus authorities in the EU, UK, Australia and China, all of which it secured.

The cuts$6 billion, and a memo that says the quiet part out loud

The part of the merger Wall Street is watching most closely isn’t the franchises — it’s the scissors. Paramount has said it aims to cut $6 billion in costs over three years, partially through layoffs, and Tuesday’s employee memo from Ellison and Kreiz gestured at exactly that. Staffers, including at CNN, have been bracing for what the Post describes as a potential “bloodbath.” A report from Los Angeles County’s municipal government warned the merger could eradicate 4,500 film and TV jobs.

This is the tension at the heart of the deal: Ellison promised Bonta more domestic production spending to win the antitrust fight, and promised Wall Street billions in cost cuts to justify the price. Both can’t be true forever. The first year of Skydance will be the test of which promise survives.

New bossesDe Luca and Abdy out, Gunn and Safran stay

The leadership shake-up is now official. Warner Bros. Motion Picture Group chiefs Michael De Luca and Pamela Abdy — who ran the studio’s film slate since 2022 — are departing, and won’t be joining the merged company. Taking their place: Paramount’s Dana Goldberg and Josh Greenstein, named co-chairs of the Skydance Motion Picture Group, putting them at the top of the combined film operation.

For DC fans, the bigger news is continuity. James Gunn and Peter Safran are officially staying as co-chairmen of DC Studios, putting to rest fears that another ownership change would trigger another reset of the DC Universe just as it gets moving — “Man of Tomorrow” is dated for July 9, 2027, and Matt Reeves’ “The Batman: Part II” for February 18, 2028. HBO’s Casey Bloys takes on an expanded streaming role, and Mark Thompson stays at CNN. The message from the new regime is clear: the franchises survive, the old guard doesn’t.

The water towerA century of Hollywood, rebranded in a day

The deal’s most poetic image arrived Tuesday in Burbank, where workers added the words “A Skydance Corporation” to the iconic Warner Bros. water tower. The 133-foot tower was built in 1927 and once held 100,000 gallons of water; it was moved from its original spot near the Warner Bros. Fire Department after the 1933 Long Beach earthquake, over fears it could topple and disrupt emergency services. It became a fixture of the studio’s identity — and of “Animaniacs” in the 1990s — bearing little more than the giant WB shield for decades. That changed Tuesday.

There’s precedent: Paramount’s own 145-foot water tower got the same “A Skydance Corporation” treatment last year after Ellison’s August 2025 acquisition of Paramount Global. The towers are bookends now — two century-old studio lots, one corporate name. Warner Bros. was launched in 1923, Paramount Pictures in 1912; as of Tuesday, both answer to a company named after a production outfit Ellison founded in 2006. Hollywood’s consolidation era, in one photograph.

What comes next is the part nobody can price yet. Wall Street, per Dow Jones, is taking a wait-and-see approach to Skydance’s ambitious goals against a tough media backdrop. The franchises are real, the subscribers are real, and the $6 billion in promised cuts is very real. Whether the new giant can actually make the math work — 30 films a year, $1.5 billion in new production, billions in cuts, all at once — is the story of the next three years. Tuesday was just the closing.