Paramount Skydance has finalized its $110 billion acquisition of Warner Bros Discovery, marking one of the largest mergers in Hollywood history. The deal, completed on October 6, brings together studios behind "Mission: Impossible," "Harry Potter," and DC Studios, along with major television and streaming networks such as CBS, CNN, Paramount+, and HBO Max. This merger forms an expansive entertainment company spanning film, TV, and news.
The new company, called Skydance, is the latest iteration of a conglomerate once controlled by the late Sumner Redstone. CEO David Ellison outlined his vision for the merged entity, stating it was a chance "to build the next-generation media and entertainment company, powered by creativity and technology." Ellison emphasized that the goal was not simply to get bigger but "to take on the biggest players in our industry."
Skydance faces competition from established players like Netflix, Disney, and tech giants such as Apple, Meta, and Amazon. Ellison noted that the merger was necessary to better compete with these challengers in a rapidly changing media landscape. He criticized the industry's complacency, allowing Netflix and Amazon Prime Video to disrupt traditional business models.
The merger has received approval from Warner Bros Discovery shareholders and has overcome legal barriers, including settlements with a coalition of US states and a Hollywood writers union. As part of the deal, Ellison agreed to create an editorial independence board to oversee CNN and CBS, addressing concerns about potential biases in news coverage.
Key leadership roles will remain unchanged, with Mark Thompson continuing as CNN chief and Bari Weiss as CBS News Editor-in-Chief. Both will report to Ellison and co-CEO Ynon Kreiz. Kreiz, former CEO of Mattel, has been appointed to the company's board, alongside other notable figures such as former Activision Blizzard CEO Bobby Kotick and Laurene Powell Jobs.
The combined company aims to achieve $6 billion in planned savings, primarily from "non-labor sources," including combining technology and cloud providers. Skydance plans to merge its streaming services, including HBO Max and Paramount+, into a single service and has pledged to release at least 30 films annually. The company is expected to carry about $80 billion in debt.
Analysts forecast core operating profit, or EBITDA, of $16 billion for 2028, rising to $19 billion in 2030. The research firm also predicted about $67 billion in revenue in 2028, growing to roughly $70 billion in 2030. Ellison has pledged to spend $30 billion or more each year on content, signaling a significant commitment to growth and expansion.
Key points
- The merger creates a Hollywood heavyweight with control of major studios and networks.
- CEO David Ellison aims to compete with established players like Netflix and Disney.
- The combined company plans to achieve $6 billion in savings and invest heavily in content.
