Paramount Skydance has finalized its $110bn acquisition of Warner Bros Discovery, forming a new entertainment giant called Skydance. This merger brings together studios behind popular franchises such as Mission: Impossible, Harry Potter, and DC Studios, along with major television and streaming networks like CBS, CNN, Paramount+, and HBO Max. The combined company will trade under the ticker "SKYD" on the New York Stock Exchange.
The merger, one of the largest in media history, was made possible after settlements with a coalition of US states and a Hollywood writers union resolved the main legal barriers. Skydance CEO David Ellison will oversee the new company, which spans film, TV, and news. The deal comes as Hollywood faces challenges such as declining cable-TV subscriptions and pressure from unions over jobs and creative workers' rights.
The Skydance name was chosen to retain the individual identities of Paramount and Warner Bros studios. However, analysts believe the name highlights Ellison's control over Hollywood's most iconic brands. In 16 years, Skydance has grown from an independent studio to a central player in a major Hollywood power play. Founded in 2010 by David Ellison, son of Oracle co-founder Larry Ellison, Skydance built its reputation as a financial backer and producer of Paramount's Top Gun: Maverick.
As part of the merger, Warner Bros shareholders received an additional $41.9m in "ticking fee" based on the number of days between September-end and the deal closing. Ellison has named Mattel's former CEO Ynon Kreiz as Skydance co-CEO to oversee day-to-day operations and integration. Ellison will focus on creative direction and overall strategy. The duo aims to achieve $6bn in planned cost savings, partly by combining streaming technologies and cloud providers.
The combined company plans to merge its streaming services, including HBO Max and Paramount+, into a single service. Skydance has pledged to release at least 30 films in the first two years after closing, rising to 32 a year for the following three. However, the scale of the cuts is expected to affect jobs across Hollywood. The company is also expected to carry about $80bn in debt, putting pressure on Ellison to grow streaming and improve theatrical film performance.
Analysts forecast ebitda of $16bn for 2028, rising to $19bn in 2030. The brokerage also predicted about $67bn in revenue in 2028 for the company, growing to roughly $70bn in 2030. CNN chief Mark Thompson and CBS news editor-in-chief Bari Weiss will continue in their respective leadership roles.
Ellison's annual base salary will be $5m, with a target annual bonus of $5m. The merger marks a significant milestone in Hollywood's evolving media landscape, with Skydance poised to become a major player in the entertainment industry.
Key points
- Skydance will trade under the ticker "SKYD" on the New York Stock Exchange.
- The combined company aims to achieve $6bn in planned cost savings.
- Skydance plans to release at least 30 films in the first two years after closing.
