Skydance Closes $110 Billion Warner Bros. Discovery Takeover
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| Paramount has completed its Warner Bros. Discovery takeover, creating Skydance and combining major film, television, streaming and news businesses. |
Paramount has completed its acquisition of Warner Bros. Discovery (WBD), creating a combined media company named Skydance. The company announced the closing on October 6, 2026, ending a deal fight that began with Paramount's hostile bid late last year and drew in Netflix, state attorneys general and, at the last moment, the Supreme Court. WBD shareholders received $31.01666668 in cash per share, and the new company's Class B shares began trading on the New York Stock Exchange under the ticker SKYD. The transaction is valued at roughly $110 billion including debt and is financed with $47 billion of new equity and a large pile of new borrowing. This article uses the company's own filings and releases, and separates official claims, press reports and editorial analysis.
What Closed
According to the company's press release, Skydance Corporation, formerly Paramount Skydance Corporation, completed the acquisition after receiving all required regulatory approvals and satisfying customary closing conditions. WBD stock has ceased trading on Nasdaq, and Skydance Class B shares started trading on the NYSE the same day.
The combined company brings together two major film studios, two global streaming services, broadcast and cable networks, and the news operations CBS News and CNN. Its brands include Paramount, Warner Bros., HBO and HBO Max, Paramount+, CBS, CNN, CBS Sports, TNT Sports, Nickelodeon, Cartoon Network, MTV, Food Network, BET, HGTV and Comedy Central.
Terms and Ownership
Under the agreement, WBD shareholders received cash equal to $31.01666668 per share. The company says the deal included $47 billion of new equity investment in Class B common stock, priced at $12.00 per share. The investors were led by the Ellison Family and RedBird, along with Public Investment Fund, L'IMAD, Qatar Investment Authority and LionTree. The debt financing was led by Bank of America, Citigroup and Apollo.
The release states that the Ellison Family holds the largest equity stake in Skydance. It also says the Ellison Family and RedBird Capital Partners together are the sole holders of Class A common stock, which carries 100% of the combined company's voting shares. In plain terms, ordinary Class B shareholders, including the new investors, do not control votes.
How the Deal Was Financed
Paramount's own releases and filings show the debt side. On September 28, 2026, the company launched an offering of about $44.4 billion of senior secured first lien and second lien notes. On September 30, it announced pricing of $41.4 billion plus €885 million of senior secured notes, along with $8.5 billion plus €850 million of incremental term loan B facilities.
Reporting based on the pricing announcement, carried by Investing.com, gave more detail. The first lien notes totaled $30 billion across eight tranches maturing between 2028 and 2066, with interest rates from 6.30% to 8.90%. The second lien notes totaled $11.4 billion across four tranches maturing between 2031 and 2036, at 7.00% to 9.125%. The U.S. term loan tranche was issued at 99.75% of face value at Term SOFR plus 2.75%.
The company said proceeds, together with cash on hand, term loan borrowings and the equity raise, would fund the purchase price and repay certain existing debt. An April 2026 filing shows the earlier bridge commitments had been cut from $54 billion to $49 billion once permanent financing arrangements were in place. Paramount's first-quarter report also disclosed that it drew $2.15 billion on its revolver to pay a $2.8 billion termination fee WBD owed Netflix when it signed with Paramount.
A 24/7 Wall St. report said S&P Global Ratings cut Paramount to BB from BB+ on September 24 and expected leverage to stay around 7.6 times EBITDA through 2027. I saw that figure only in a search excerpt, so treat it as reported and unverified.
The Road to Closing
The company's own SEC filings and press coverage trace the sequence. Paramount launched a hostile bid for all of WBD in 2025, and Netflix's competing agreement fell apart after it declined to match Paramount's $31-per-share offer. Paramount and WBD signed a definitive merger agreement on February 27, 2026, and WBD shareholders approved it on April 23, according to a CNBC timeline I saw only in excerpt.
The deal then faced antitrust scrutiny. Yahoo Finance reported that Paramount settled with a dozen states, including California, which had sought to block the acquisition. Under that agreement, the combined company faces financial penalties if it fails to release at least 30 films in theaters each year. Yahoo, citing Bloomberg and two unnamed people familiar with the discussions, said Paramount would pay $30 million for each film short of the target and could be forced to sell its 49% stake in Miramax. Those penalty terms are reported, not confirmed by the company.
In a long-shot effort filed the day before closing, four petitioners who described themselves as Paramount customers argued the merger remained anticompetitive. According to Yahoo, Supreme Court Justice Elena Kagan denied the petition without comment, and the deal closed the next day. Paramount's release says the deal received unanimous approval from competition authorities covering nearly 70 jurisdictions.
Leadership
David Ellison is chairman and CEO. Ynon Kreiz, who left Mattel last week, is co-CEO. Yahoo Finance, citing the company's Monday announcement, said Ellison will focus on long-term strategy, creative vision and capital allocation, while Kreiz will handle day-to-day management and integration.
The same report said CBS News editor in chief Bari Weiss and CNN chairman Mark Thompson stay in their roles, Paramount CFO Dennis Cinelli keeps that job, HBO head Casey Bloys becomes chief content officer, and CBS Sports chief David Berson takes over combined sports operations as WBD's Luis Silberwasser exits. Yahoo also said, citing an SEC proxy filing I did not open, that WBD CEO David Zaslav stands to receive roughly $886.8 million.
What the Company Promises
The release contains several targets. They are company projections and forward-looking statements:
- At least 30 theatrical films a year, each with a minimum 45-day theatrical window, and more than 180 television shows.
- At least $6 billion of run-rate synergies within three years, mainly from technology, integration and procurement, marketing and real estate.
- Net leverage reduced to a 3.0x target by the end of 2029.
- More than $10 billion in free cash flow by 2030.
- Streaming products to unify into a single service over time.
The company also says the combined business has nearly $70 billion in revenue, more than 200 million streaming subscribers and pro forma content spending above $30 billion for the last twelve months.
Key Facts at a Glance
| Item | Detail | Source |
|---|---|---|
| Closing date | October 6, 2026 | Company release |
| Cash per WBD share | $31.01666668 | Company release |
| New equity | $47 billion at $12.00 per Class B share | Company release |
| Notes priced | $41.4 billion plus €885 million | Company release |
| Term loan B priced | $8.5 billion plus €850 million | Company release |
| Ticker | SKYD, NYSE | Company release |
| Synergy target | At least $6 billion in three years | Company projection |
| Net leverage target | 3.0x by end of 2029 | Company projection |
Confirmed, Reported and Unknown
Confirmed by the company: the closing, the cash price, the equity raise, the financing pricing announcements, the ownership and voting structure, and the stated targets.
Reported by outlets: the state settlement penalties, the Kagan denial, executive roles, Zaslav's payout, the S&P rating action and the tranche-level debt terms.
Not yet known: whether the synergies and deleveraging will arrive on schedule, how many jobs will be cut, how the streaming services will be combined, and how the penalties in the state settlement would be enforced.
Editorial Analysis
The following is analysis, not reported fact.
The most important feature of this deal is the balance sheet. A 24/7 Wall St. report, citing a market capitalization around $10.8 billion for the acquirer, noted that the $41.4 billion of newly priced secured notes alone is far larger than that figure. I could not verify the market cap itself, but the comparison shows how much of the deal rests on borrowing. The company's own leverage target of 3.0x by 2029 is far below the roughly 7.6x S&P expects, so most of the promised value depends on cutting costs and generating cash quickly.
The voting structure matters too. Because Class A shares carry all of the voting power and are held by the Ellison Family and RedBird, minority investors have economic exposure without a vote. That is a design choice the company itself discloses as a risk.
The state settlement ties a political promise to financial penalties. A minimum of 30 films a year is a business commitment as much as a regulatory one, and it may constrain how aggressively the new company can cut spending on theatrical output.
Needham analyst Laura Martin wrote in a note quoted by Yahoo Finance that the combination creates a formidable global streaming competitor by putting HBO, Warner Bros., Paramount+, CBS and Discovery under a single owner. That is one analyst's view, and execution will test it.
Risks and Open Questions
- Leverage. The company itself lists the ability to meet debt covenants and deleverage as a risk factor.
- Synergy delivery. The $6 billion target depends on integration, which carries risk of talent loss and disruption.
- Linear TV decline. The company flags advertising revenue and shifts in consumer behavior as risks.
- Governance. The dual-class structure and controlled-company status limit minority shareholder influence.
- News operations. Combining CBS News and CNN under one owner may draw continued scrutiny.
What to Watch Next
Watch for the first earnings report as a combined company, early integration and layoff announcements, debt refinancing and rating actions, and details on how HBO Max and Paramount+ will be combined. Also watch compliance with the theatrical commitment under the state settlement.
Frequently Asked Questions
What happened on October 6, 2026?
Paramount completed its acquisition of Warner Bros. Discovery. The combined company is named Skydance and trades on the NYSE as SKYD.
How much did WBD shareholders receive?
$31.01666668 in cash per share, according to the company's release.
How big is the deal?
About $110 billion on an enterprise basis, which includes debt. Some outlets round to $111 billion.
Who runs the new company?
David Ellison is chairman and CEO, and Ynon Kreiz is co-CEO.
How was it paid for?
With $47 billion of new equity and tens of billions of dollars in new secured notes and term loans, as detailed in the company's financing announcements.
Did anyone try to stop it?
A group of states sued and settled. Yahoo Finance reported that Supreme Court Justice Elena Kagan denied a last-minute petition by four self-described Paramount customers.
Is this investment advice?
No. This article is informational only. Readers should review the company's filings and consult a qualified financial professional.
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