Paramount Buys Warner Bros. Discovery
Paramount has acquired Warner Bros. Discovery in a massive $110-111 billion deal, outbidding Netflix to do so. The merger creates the third-largest media company in the U.S. and the single most dominant owner of sports rights, reshaping the streaming and entertainment landscape for executives, advertisers, and athletes.
The acquisition is being structured as an all-cash offer of $31 per share for Warner Bros. Discovery, valuing the company at an enterprise value of $110 billion and an equity value of $81 billion. To finance the deal, Paramount Skydance has secured $47 billion in equity from the Ellison family and RedBird Capital Partners, complemented by $54 billion in debt commitments from a banking consortium that includes Bank of America, Citi, and Apollo. The leadership team for the merged entity will be headed by David Ellison as Chairman and CEO, with former NBCUniversal CEO Jeff Shell serving as President. Warner Bros. Discovery's current CEO, David Zaslav, will depart after the merger's completion. Paramount's leadership will be organized into three divisions: studios, direct-to-consumer, and TV media, with George Cheeks, one of Paramount's current co-CEOs, set to lead the TV media division. This combination creates an unparalleled library of intellectual property. The new company will hold over 15,000 film titles and thousands of television hours, uniting blockbuster franchises like Paramount's *Mission: Impossible*, *Top Gun*, and *Transformers* with Warner Bros.' *Harry Potter*, *Game of Thrones*, and the DC Universe. Both the Paramount Pictures and Warner Bros. studios will be maintained, with a commitment to produce a minimum of 30 theatrical films annually. The deal solidifies the new company's dominance in sports broadcasting, rivaled only by ESPN. The combined portfolio will include top-tier rights currently held by CBS Sports and TNT Sports, such as the NFL, the full NCAA March Madness tournament, MLB and NHL playoffs, The Masters, and the PGA Tour. This extensive collection of live sports will be distributed across the company's broadcast, cable, and streaming platforms. On the streaming front, the merger will consolidate Paramount+, HBO Max, and Pluto TV under one corporate umbrella, creating a more formidable competitor to market leaders Netflix and Disney+. The combined entity is expected to command over 14% of the U.S. streaming market, positioning it ahead of YouTube and Disney. The companies anticipate achieving over $6 billion in cost savings and operational efficiencies through this integration. The transaction is expected to close in the third quarter of 2026, pending approval from Warner Bros. Discovery shareholders and regulatory clearance. The deal has already attracted scrutiny from lawmakers concerned about reduced consumer choice and is under review by the Department of Justice. The agreement includes a "ticking fee" payable to WBD shareholders if the deal does not close after September 30, 2026.
