Warner Bros Discovery will be purchased by Paramount Skydance in a massive $110 billion transaction, concluding an intense corporate battle after Netflix withdrew from competing offers, the companies announced Friday.
The entertainment merger, valued at $81 billion in equity, is scheduled for completion during the third quarter of 2026. The agreement came after Netflix chose not to match Paramount’s enhanced $31-per-share proposal on Thursday, which Warner Bros considered more attractive than the streaming company’s previous $27.75-per-share bid for the studio and streaming properties.
“Netflix had the legal right to match the PSKY offer. As you all know, they ultimately decided not to do that. That then resulted in a signed agreement with PSKY as of this morning. So that’s where everything stands,” Bruce Campbell, Warner Bros’ chief revenue and strategy officer, explained during a company-wide meeting.
Financial backing for the acquisition includes $47 billion in equity from the Ellison Family and RedBird Capital Partners, along with $54 billion in debt commitments from Bank of America, Citigroup and Apollo. Paramount also intends to offer existing shareholders up to $3.25 billion in Class B stock through a rights offering.
The combined entertainment giant expects to achieve over $6 billion in cost reductions through technology consolidation, corporate streamlining and operational improvements, according to both companies.
This merger will create a film collection exceeding 15,000 titles, bringing together beloved properties including “Game of Thrones,” “Mission Impossible,” “Harry Potter,” and the DC Universe under one corporate umbrella.
Despite Paramount’s victory in the acquisition battle, the deal faces regulatory examination. California officials are preparing an intensive review of the $110 billion transaction that could significantly alter Hollywood’s landscape.
David Ellison, son of tech billionaire Larry Ellison, leads Paramount and maintains strong political ties to the Trump administration, potentially smoothing federal regulatory approval processes.
California State Attorney General Rob Bonta announced Thursday that his office is already examining the deal and promised a “vigorous” evaluation.
European Union antitrust clearance appears likely with minimal required asset sales, industry sources indicated Friday.
This transaction ranks among Hollywood’s most significant corporate restructurings and will establish one of the world’s largest film studios. The deal enables Paramount to access Warner’s extensive intellectual property portfolio, including “Fantastic Beasts” and “The Matrix” franchises.
The merger also strengthens Paramount’s streaming capabilities, potentially combining HBO Max and Paramount+ platforms to better compete with industry leader Netflix for market dominance.
Paramount pursued Warner Bros since late last year through an aggressive campaign, consistently increasing offers to secure the acquisition from the streaming competitor.
In its final proposal, Paramount increased the termination penalty from $5.8 billion to $7 billion should regulatory approval fail. The company also covered the $2.80 billion termination fee Warner Bros owed Netflix, according to regulatory documents filed Friday.
Activist investor Ancora Holdings, holding a minority Warner Bros stake, had pressured the company to engage more seriously with Paramount’s proposals.
Political leaders from both parties have expressed concerns that acquiring Warner Bros could limit consumer options and increase entertainment costs.
Theater operators worry that consolidating major Hollywood studios might eliminate jobs and reduce the number of films released for theatrical distribution.
