Paramount completes Warner Bros. Discovery acquisition
The combined company will operate under the Skydance name, with its Class B shares beginning trading on the New York Stock Exchange under the ticker SKYD.
Skydance has completed its acquisition of Warner Bros. Discovery (WBD), creating a combined media and entertainment company that brings together major film studios, streaming services, television networks, news operations and sports properties.
Skydance combines film, television and streaming assets
The transaction closed after receiving regulatory approvals in nearly 70 jurisdictions and meeting the other conditions set out in the merger agreement. WBD shareholders received $31.01666668 in cash per share, while WBD shares ceased trading on Nasdaq.
The combination brings together Paramount's and WBD's film and television operations, along with streaming platforms, CBS, HBO, cable networks, CBS News, CNN, CBS Sports and TNT Sports. The company also holds an extensive programming library and franchises including Top Gun, Harry Potter, The White Lotus and SpongeBob SquarePants.
Skydance outlines content and production strategy
Skydance says the combined business will serve audiences in more than 200 countries and territories, with more than 200 million streaming subscribers across its platforms. It plans to release at least 30 theatrical films annually, each with a minimum 45-day theatrical window, and has more than 180 television shows.
The company also plans to commission productions from independent studios and license its content to third parties, with the stated aim of supporting independent production and creating opportunities for entertainment workers.
David Ellison, Chairman and CEO of Skydance: "Today is a historic day, not just for Skydance but for our entire industry. From the start, our ambition was to bring these two storied studios together and create a stronger competitor, with the talent, resources, and reach to tell great stories in every genre, on every platform, for audiences everywhere. Now that ambition is a reality. We're grateful to everyone who made this possible – the employees, creative talent, and production teams of both companies, who worked tirelessly to get us here and inspire audiences around the world every day, as well as the advisors and partners who guided this transaction to completion. Our focus now turns to the future: building a company that empowers creatives, entertains audiences and rewards shareholders. We couldn't be more excited to get to work."
Skydance targets streaming and operational efficiencies
The company plans to improve its direct-to-consumer streaming products and eventually consolidate them into a single service. It also expects the combination to generate more than $6 billion in run-rate synergies over the next three years through technology, integration, procurement, marketing and real estate savings.
Gerry Cardinale, Founder and Managing Partner, RedBird Capital and a Skydance Board Director: "This is a defining moment for the industry. By applying our owner-operator model to Paramount and WBD's unmatched portfolio of iconic franchises, premium original programming, and live sports rights, we can protect that legacy while building for a media landscape that's undergoing transformational change. David, our Co-CEO Ynon Kreiz, and the rest of our world-class Skydance team have the vision and track record to lead through this change. We're proud to back them as we build a stronger Hollywood, expand opportunities for talent, and create long-term value for our shareholders."
Skydance targets $10 billion in free cash flow
Skydance expects the combined company to generate more than $10 billion in free cash flow by 2030 while targeting a reduction in net leverage to 3.0x by the end of 2029. The company reported nearly $70 billion in revenue and more than $30 billion in pro forma content spending over the last 12 months.
The transaction included $47 billion of new equity investment in Class B Common Stock from investors including the Ellison Family, RedBird, Public Investment Fund, L'IMAD, Qatar Investment Authority and LionTree. The shares were priced at $12 per share. Bank of America, Citigroup and Apollo led the debt financing.
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