Paramount's $110B Warner Bros. Deal Under Review
The massive $110B acquisition of Warner Bros. Discovery by Paramount is now undergoing a US antitrust review. The plan involves merging Paramount+ and HBO Max to create a streaming giant intended to challenge Netflix's market dominance.
The high-stakes bidding for Warner Bros. Discovery concluded in late February 2026, with Paramount Skydance emerging as the victor over Netflix. Paramount's winning offer is a $110.9 billion all-cash deal, valuing Warner Bros. Discovery shares at $31 each. To seal the deal, Paramount also covered the $2.8 billion termination fee that Warner Bros. Discovery owed to Netflix after backing out of their previous agreement. The acquisition is being driven by Skydance Media CEO David Ellison, son of Oracle co-founder Larry Ellison. His company, once a small production house, has grown by co-financing hits and forming strategic partnerships, positioning itself for this massive takeover. For Paramount's controlling shareholder, Shari Redstone, the sale marks a pivotal moment, influenced by a desire to focus on other interests after years of navigating industry shifts and internal company struggles. A primary strategic goal is to create a streaming service with the scale to rival Netflix. By combining Paramount+ and HBO Max, the new entity would serve over 200 million subscribers globally. This move is seen as crucial for survival by Warner Bros. Discovery CEO David Zaslav, who has noted the immense size of competitors like YouTube-parent Alphabet. The merged company would boast a colossal content library, combining iconic franchises like Paramount's "Mission: Impossible" and "Star Trek" with Warner Bros.' "Harry Potter," "Game of Thrones," and the DC Universe. The plan includes a commitment to produce at least 30 theatrical films annually, each with a minimum 45-day exclusive window in cinemas before moving to streaming. However, the new media giant would take on a significant financial burden, with a combined net debt projected to be around $79 billion. Warner Bros. Discovery ended the last year with a net debt of $29 billion, while Paramount had $10.36 billion. The deal is financed through a combination of $47 billion in new equity and $54 billion in debt commitments. The transaction, expected to close in the third quarter of 2026, is pending regulatory and shareholder approvals. The process could take six to 18 months and is expected to face intense antitrust scrutiny from regulators concerned about media consolidation. To mitigate the risk of regulatory blockage, Paramount has agreed to pay a $7 billion termination fee if the deal fails to get approved.
