Paramount and Warner Bros. Discovery have officially finalized their merger, resulting in the creation of Skydance Corp., which will be managed by David Ellison. This new corporation is valued at $111 billion (approximately R$ 662.7 billion) and consolidates various studios, television networks, and streaming platforms, such as Paramount+ and HBO Max.
The projected annual revenue for the new company reaches nearly $70 billion (R$ 417.9 billion), although it begins operations with a net liability of $80 billion (R$ 477.6 billion). Furthermore, the group will need to integrate its operations and implement cost cuts, which anticipates thousands of layoffs in the coming months.
The merger brings together notable brands such as Paramount Pictures, Warner Bros., HBO, Pluto TV, CBS, CNN, Nickelodeon, Cartoon Network, MTV, TNT Sports, Food Network, BET, HGTV, and Comedy Central. David Ellison, who holds the positions of President and CEO of Skydance, described the closing of the deal as a crucial moment for the industry.
He stated: 'Today is a historic day, not just for Skydance, but for our entire industry.' According to the executive, the initial goal was to combine the two studios to establish a competitor with greater reach and more resources, affirming: 'Now that ambition is a reality.'
The Ellison family, supported financially by billionaire Larry Ellison, David's father, holds the largest shareholding in Skydance. Together with RedBird Capital Partners, they own Class A common shares of Paramount, which guarantee 100% voting rights of the resulting company.
One of the most significant transformations for the public will be the unification of digital operations. Skydance announced that Paramount+ and HBO Max will be integrated into a single service over time.
The company expects to achieve over $6 billion (R$ 35.8 billion) in operational synergy gains over the next three years. Expense reduction efforts will primarily focus on areas such as technology, integration, acquisitions, marketing, and real estate.
The corporate strategy covers several points: Skydance's Class B shares have already been listed on the New York Stock Exchange under the ticker 'SKYD,' while Warner Bros. Discovery bonds have ceased trading on Nasdaq. The merger financing was conducted with $47 billion (R$ 280.6 billion) in Class B stock investments, led by Larry Ellison, RedBird Capital Partners, LionTree, and sovereign funds from Saudi Arabia, Qatar, and Abu Dhabi. Debt financing was handled by Bank of America, Citigroup, and Apollo Global Management.
To manage the new entity, Ellison appointed Ynon Kreiz, former CEO of Mattel, as co-CEO. Skydance aims to reduce its net debt to adjusted EBITDA ratio from about 6 to 7 times in 2026 to 3 times by the end of 2029. Part of this improvement will come from operational restructuring, including the layoff of thousands of employees from the former Paramount and Warner Bros. Discovery in the coming months.
The new company will be structured into three business segments: Studios, Direct-to-Consumer, and TV Media. The immediate challenge lies in reconciling operational integration, controlling debt, and maintaining investments in content, creators, and technology.