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Paramount closes deal for Warner Bros.
Paramount on Tuesday officially closed its massive $111 billion acquisition of Warner Bros. Discovery, forming a single media company operating under the name Skydance Corp.
LOS ANGELES - After months of delays and legal challenges, Paramount Skydance has completed its acquisition of Warner Bros. Discovery in a deal valued at about $81 billion in equity, or nearly $111 billion including debt.
Skydance Corp. emerges from one of the biggest tie-ups ever in the media and entertainment industry.
The deal, announced Tuesday, merges two of the entertainment industry's largest companies in film and TV.
Paramount acquires Warner Bros.
Big picture view:
The companies completed the deal, ushering in a new Hollywood giant with the now shorter "Skydance" nametag.
All of them will come under the helm of billionaire David Ellison, and his new co-CEO Ynon Kreiz.
What they're saying:
"Today is a historic day, not just for Skydance but for our entire industry," Ellison said in a statement Tuesday. "We couldn’t be more excited to get to work."
Paramount settles lawsuit
Timeline:
But the road to a buyout was not an easy one.
Last month, Paramount reached a settlement with 12 states that had sued to block the acquisition, removing the central remaining legal obstacle to the deal. A federal judge approved the settlement on Sept. 30, clearing the way for the merger to close.
In the settlement, Paramount agreed to terms including a five-year movie production plan and to invest $1.5 billion in domestic movies. According to the Arizona attorney general's office, about 5% of Paramount's film production currently takes place in the U.S.
Paramount also said it would create a five-year, $25 million fund for buying independent films.
Paramount and Warner Bros are now one Hollywood giant: Skydance. (AaronP/Bauer-Griffin/GC Images / Getty Images)
In July, Paramount and Warner Bros. Discovery agreed to delay closing their merger, as a judge continued to consider the challenge from the 12 states seeking to block the deal.
At the time, both sides touted the delay as a victory.
The result was "exactly what we have sought from the outset: a direct path to a trial based on the evidence," Paramount said in a statement. The company, which was bought by Skydance just last year, added that it looked forward to proving its transaction is "good for competition, good for consumers, and good for creators."
Meanwhile, California Attorney General Rob Bonta — who was leading the states' case — called the delay great news for audiences, movie theaters and entertainment and media workers nationwide.
"Our argument against this illegal merger is straightforward: When too few corporations have too much power in markets central to American life, it makes things more expensive, and it makes things worse," Bonta said in a statement. He added that the states were eager to see their challenge through court and ensure the Paramount-Warner combo "never sees the light of day."
The Writers Guild of America separately sued in July and settled its lawsuit Sept. 21. The WGA settlement included a $17.5 million contribution to the Writers' Guild-Industry Health Fund and up to $6 million in attorneys' fees.
The Warner-Paramount mega-merger initially received shareholders’ stamp of approval in April 2026, propelling the deal closer to the finish line.
Per the preliminary vote count, the overwhelming majority of Warner Bros. Discovery stakeholders voted in support of selling the entire business to Paramount for $31 a share, the company said. Including debt, the deal was valued at nearly $111 billion based on Warner's current outstanding shares.
At the time, David Zaslav, CEO of Warner Bros. Discovery, said in a statement that stockholder approval marked "another key milestone toward completing this historic transaction." Paramount added that it looked forward to closing in the coming months, and "realizing the creation of a next-generation media and entertainment company."
How does the deal impact viewers?
Big picture view:
Paramount's transaction is for the entirety of Warner Bros., including the Global Networks segment that includes CNN and other cable assets.
Paramount’s buyout of Warner Bros. would reshape the wider media landscape in a way that Netflix never threatened to do. Netflix withdrew from the bidding in February after declining to match Paramount's offer. Netflix's proposed transaction covered a narrower group of Warner assets, while Paramount pursued the entire company.
Paramount's lineup includes blockbusters such as "Top Gun," "Titanic" and "The Godfather." The 103-year-old Warner Bros. studio has produced titles ranging from "Harry Potter" and "Superman" to "Barbie" and "One Battle After Another."
Paramount Skydance chairman and CEO David Ellison has said that he would like to grow their combined slate to more than 30 movies a year, keeping Paramount and Warner Bros. as stand-alone operations.
In documents filed to the Securities and Exchange Commission earlier this year, Paramount said, "Our priority is to build a vibrant, healthy business and industry — one that supports Hollywood and creative, benefits consumers, encourages competition, and strengthens the overall job market."
The combined company is targeting about $6 billion in cost savings, with overlapping operations expected to be a major focus of the restructuring. This could mean potential job cuts in "duplicative operations."
What does this mean for HBO Max, Paramount+ subscribers?
Dig deeper:
Beyond traditional film production, a combined Paramount and Warner would also hold big power in the TV and streaming wars.
Paramount owns networks including CBS, MTV and Nickelodeon, as well as the Paramount+ streaming service. As for Warner, it has CNN, Discovery and HBO Max among its offerings.
Paramount has argued that merging with Warner will allow it to deliver larger content libraries to its customers and compete with much bigger streaming rivals.
But will the merger benefit consumers?
The other side:
Skeptics argue that a combined company would wield enough power to control prices and increase subscription requirements to watch certain titles.
Democratic Sen. Elizabeth Warren, a longtime antimonopoly hawk, called a Paramount-Warner merger "an antitrust disaster threatening higher prices and fewer choices for American families."
The 12 states — which, beyond California, also included entertainment heavyweights like New York — sued to block the buyout, alleging that such a combination would "extinguish competition" in Hollywood and lead to fewer choices for consumers, particularly moviegoers and cable customers.
Will HBO Max and Paramount+ combine?
What's next:
This remains unclear. But based on previous mergers like Disney and Hulu, it’s possible there will be a bundling situation.
Implications for news
Dig deeper:
In addition, the acquisition puts CNN and CBS under the same roof, potentially hurting competition essential in the news business.
Similar to broadening the definition of the streaming market, advocates of the Paramount merger point to wider media offerings beyond traditional TV news, including information-sharing on social media platforms.
The settlement does not require an immediate sale of cable channels. Instead, for five years, Paramount must negotiate separately with distributors over Paramount and Warner Bros. basic-cable networks. A material violation that is not cured can ultimately trigger divestiture of specified cable channels under the consent decree.
The Source: This story was reported from Los Angeles. The Associated Press, previous FOX Local reporting contributed.