Newsletters
Paramount completed its takeover of Warner Bros. Discovery on Tuesday, Oct. 6, closing a $110 billion merger that combines two Hollywood studios, a large group of television networks, multiple streaming services and several news organizations.
The combined company is named Skydance after the studio David Ellison founded 20 years ago. Ellison leads the company with co-CEO Ynon Kreiz.
Skydance stock will trade on the New York Stock Exchange, and Ellison and Kreiz are expected to ring the bell in the coming days.
A staff meeting on the Warner Bros. lot and a press meeting are scheduled for the closing day.
The company will oversee the streaming services Paramount+, Pluto TV, HBO Max and Discovery+. Its television networks include CBS, Comedy Central, MTV, HBO and CNN.
Its franchise library includes Harry Potter, the DC Universe, Game of Thrones and SpongeBob SquarePants.
The executive team faces the task of integrating the two companies, paying down more than $80 billion in debt and shifting the business toward a technology-entertainment model.
Ellison said in a statement that the aim is to compete across genres and platforms. Gerry Cardinale, founder and managing partner of RedBird Capital and a Skydance board director, said the owner-operator model will be applied to the combined portfolio of franchises, original programming and live sports rights.
The company is positioned against Disney and Netflix, as well as Amazon, Apple and Google.
The deal followed months of contested steps, including a bidding war with Netflix and a legal fight with 12 state attorneys general and the Writers Guild of America (WGA).
Paramount received approval from Warner Bros. shareholders and regulatory clearance in 68 jurisdictions. These include the U.S. Department of Justice, the Federal Communications Commission, the European Commission and the U.K. Competition and Markets Authority.
Judge Araceli Martinez-Olguin approved a settlement between Paramount and the 12 state attorneys general.
The company must invest $1.5 billion in domestic film and television production over five years and release at least 30 films a year in theaters.
It must also negotiate distribution agreements for each company's cable networks separately, and keep operating the studio lots of both companies for five years.
The settlement requires an independent editorial board to oversee CNN and CBS News operations. Penalties for noncompliance include $30 million per film that misses the theatrical release target.
Other failures can trigger forced divestitures. Paramount would have 12 months to sell its 49% stake in Miramax, and 120 days to sell BET, Comedy Central, VH1, Smithsonian, Destination America and Science Channel.
Paramount reached a separate resolution with the WGA that includes a five-year layoff pause at CBS and a $17.5 million health fund contribution.
In the United Kingdom and Europe, the company agreed to end its stake in United International Pictures.
It also committed not to combine linear channels with its streaming services and to maintain the editorial independence of its news services and children's networks.
Paramount also agreed to provide additional funding to Channel 5 for news, original children's programming and drama.
Set as preferred source
Set as preferred source
4 min read
