Paramount completes Warner Bros. Discovery takeover, paying about $78 billion in cash and renaming itself Skydance

Paramount Skydance closed its purchase of Warner Bros. Discovery on Tuesday, bringing HBO, CNN, the Warner Bros. studio and TNT Sports under the same roof as CBS and Paramount Pictures, and renamed the combined company Skydance Corp.

Warner shareholders are being paid $31 a share in cash, plus a daily top-up of just under three-tenths of a cent for each day after Sept. 30 that the deal took to close. That brings the final price to $31.01666668 a share. Skydance estimates the total cash going to Warner stockholders at about $78 billion, plus roughly $1.1 billion for vested employee stock awards. Warner stock stopped trading on Tuesday. Its last close, $30.95 on Monday, left holders a final gain of about 7 cents a share.

Skydance's Class B shares moved from Nasdaq to the New York Stock Exchange and now trade under the ticker SKYD, replacing PSKY. Variety and the BBC put the deal's value at $111 billion and $110 billion, larger figures that reflect Warner's debt as well as the cash for its shares.

What it took to close

The company said the deal closed after it received every regulatory approval the merger agreement required, and that competition authorities in nearly 70 jurisdictions signed off. The harder fights were in American courts. About a dozen states, led by California, sued to block the merger before settling last month. Under that settlement the combined studio must release at least 30 films a year or be forced to sell its 49% stake in Miramax, according to the BBC, and must set up a news editorial independence board covering CNN and CBS. On Monday, Supreme Court Justice Elena Kagan denied without comment a last-minute petition from four people who described themselves as Paramount customers, Yahoo Finance reported.

How the purchase was paid for

The equity came first. At closing, investors bought 3,917,657,246 new Class B shares at $12 each, according to the company's filing with the Securities and Exchange Commission, roughly $47 billion. The company said that money was led by the Ellison family, RedBird Capital Partners, Saudi Arabia's Public Investment Fund, Abu Dhabi's L'IMAD, the Qatar Investment Authority and LionTree. Those investors agreed not to sell the new shares for 180 days.

The rest was borrowed. The day before closing, the company issued $41.4 billion of secured bonds, with first-lien coupons running from 6.3% on notes due 2028 to 8.9% on notes due 2066, and second-lien coupons as high as 9.125%. It also took $8.5 billion and 850 million euros of seven-year term loans. That let it cut a $49 billion bridge-loan commitment from Bank of America, Citigroup and Apollo to zero and terminate it.

The result is a heavily indebted company. Unaudited pro forma figures in the same filing, which combine the two companies as of June 30 and include the new borrowing, show about $80.3 billion of long-term debt and another $2.2 billion due within a year. Skydance says it aims to bring net leverage, debt minus cash measured against annual earnings, down to its target of three times by the end of 2029.

What Skydance is promising

The company describes itself as one of the largest media groups in the world, with nearly $70 billion of revenue. On the pro forma basis, the two companies together had $66.1 billion of revenue in 2025. Skydance is targeting at least $6 billion of annual cost savings within three years, mainly from technology, integration and purchasing, marketing and real estate, and says it expects more than $10 billion of free cash flow by 2030.

For audiences, it has promised at least 30 theatrical films a year, each with a minimum 45-day run in cinemas before moving elsewhere, and says Paramount+ and HBO Max will be combined into a single streaming service over time. It counts more than 200 million streaming subscribers across its platforms and more than $30 billion of content spending over the past 12 months.

"Our focus now turns to the future: building a company that empowers creatives, entertains audiences and rewards shareholders," David Ellison, Skydance's chairman and chief executive, said in the completion release.

Who controls Skydance

Public shareholders own nonvoting Class B stock. The Ellison family holds the largest economic stake, and the family and RedBird together own all of the Class A shares, which carry 100% of the voting power. Those holders approved the charter change that renamed the company by written consent.

Last week Ellison named Ynon Kreiz, the outgoing chief executive of Mattel, as co-chief executive to run day-to-day operations and the integration. The filing also shows Andrew Brandon-Gordon, previously chief strategy officer and chief operating officer, was named president at closing, and that Ellison's base salary rose to $5 million with a $5 million target bonus.

How the shares opened

Skydance shares opened at $9.84 on the New York Stock Exchange and were at $9.70 at 9:35 a.m. ET, down 0.8% from Monday's $9.78 close under the old ticker, according to cnbc.com market data. That is about 19% below the $12 a share the new equity investors paid at closing, by TickerGrove's calculation.