09:42Machine-translated from Azerbaijani by AIRead in Azerbaijani
Paramount and Warner Bros. Discovery Merge in $110 Billion Deal
Paramount and Warner Bros. Discovery merged on Tuesday after negotiations lasting about 1 year. The deal is valued at $110 billion (AZN 187 billion). Some reports put the amount at $111 billion (approximately AZN 188.7 billion). The combined company will be called Skydance and will be led by billionaire David Ellison. This has created one of the world’s largest media companies.
Skydance now controls 2 major film studios. Television channels such as CBS, CNN, MTV, TBS, Comedy Central and Food Network are also part of the company. TNT, Adult Swim, Cartoon Network and Nickelodeon have also come under the same company. HBO Max and Paramount+ will eventually become a single service. This means that movies and series from both platforms could be combined under the same subscription.
The company’s film and television portfolio includes DC, Harry Potter, Game of Thrones, Mission: Impossible and The Lord of the Rings. The list also includes Star Trek, Looney Tunes, SpongeBob SquarePants and Yellowstone. Skydance has committed to releasing 30 movies in theaters in each of the first 2 years. That number will rise to 32 movies over the following 3 years. It also plans to release at least 4 independent films and more than 180 television programs and series each year.
The combined Skydance’s annual revenue will reach approximately $70 billion (AZN 119 billion). The Ellison family is the company’s largest shareholder. The family’s main financial backer is Oracle co-founder Larry Ellison. Class B shares have begun trading on the New York Stock Exchange under the ticker SKYD. Trading of WBD shares on Nasdaq has been halted.
The company will start with $80 billion in debt (AZN 136 billion). The merger took place after Skydance acquired Paramount last summer for $8 billion (AZN 13.6 billion) and prevailed in its competition with Netflix.
The merger has sparked strong opposition because it reduces the number of major Hollywood studios to 4. More than 1,000 people working in the industry have criticized the deal. The Writers Guild of America is concerned that writers’ pay and the number of projects produced will decline. Paramount+ subscribers have also filed a separate lawsuit over concerns that prices could rise. The final legal hurdles were cleared following agreements with 12 states, including California, and the Writers Guild.
Political concerns about the merger also persist. Investors allege that the Ellison family entered into an illegal side agreement with the Donald Trump administration and promised to make changes at CNN. Paramount denies the allegation. CBS management has been accused of self-censorship and acting in accordance with the administration’s demands. CNN chief Mark Thompson said he believes the network’s independence will be protected. Elon Musk’s participation in the investor group has also been discussed. The combined stake held by Middle Eastern funds could reach approximately half of the company.
David Ellison called the merger a historic day for both Skydance and the entire industry. However, a letter sent to employees acknowledged that difficult decisions would be made and layoffs would occur as the 2 companies are combined. According to Ellison, the main goal is to create more opportunities for creative teams, entertain audiences and generate returns for shareholders.