It’s official: After a relentless pursuit Paramount Skydance reached an agreement to acquire all of Warner Bros. Discovery in a deal reflecting a $110 billion enterprise value for the media company.
The news came Friday after Paramount’s months’ long effort took another turn when the company increased its offer to $31 per share all-cash, among other sweetened elements that in turn made WBD’s board designate it a superior offer to an existing $83 billion agreement with Netflix, which had been selected the winning bidder back in December. But rather than coming back with its own increased offer, Netflix last week officially bowed out of the equation – paving the way for a deal between Paramount and WBD.
Paramount is also responsible for paying a $2.8 billion termination fee owed to Netflix by WBD for terminating their deal.
With a definitive merger agreement in place, Boards of Directors of both companies unanimously approved the Paramount-WBD transaction, which they expect to close by Q3 2026. It still requires regulatory clearances and approval by WBD shareholders, with a vote expected in early spring 2026.
As part of the sweetened offer, if the deal doesn’t close by September 30, WBD shareholders will receive a $0.25 per share “ticking fee” for each quarter until closing.
"From the very beginning, our pursuit of Warner Bros. Discovery has been guided by a clear purpose: to honor the legacy of two iconic companies while accelerating our vision of building a next-generation media and entertainment company,” stated Paramount CEO and Chairman David Ellison. “By bringing together these world-class studios, our complementary streaming platforms, and the extraordinary talent behind them, we will create even greater value for audiences, partners and shareholders — and we couldn't be more excited for what's ahead."
Paramount expects the deal to result in over $6 billion in synergies, a factor which the NYT reported has some concerned over a potential large wave of job cuts coming as a result of reducing redundant or overlapping departments and job functions.
The combination brings together television and film studio, linear cable assets, as well as streaming operations and content IP and franchises from both companies. That includes a combined film library of more than 15,000 titles and thousands of hours of TV, alongside iconic franchises like Harry Potter, Mission Impossible, Lord of the Rings, Game of Thrones, the DC Universe, Teenage Mutant Ninja Turtles, Transformers, Star Trek and SpongeBob SquarePants.
On the theatrical front, Paramount committed to producing a minimum of 30 theatrical films per year. It plans a minimum 45-day theatrical window globally before becoming available on paid video on-demand services – with plans for that window to be 60-90 days or more to maximize the audience – and also preserving the current model of release to paid VOD before making them available on SVOD services.
When it comes to SVODs, the merger brings together streaming services of Paramount+ and HBO Max – as well as Paramount-owned FAST Pluto TV and WBD’s Discovery+.
And Paramount intends to combine the flagship Paramount+ and HBO Max streamers into one service post-merger, which it believes will help it achieve greater scale and compete more effectively – although details on what that execution will look like exactly remain to be seen.
Paramount held a call for investors Monday regarding the deal and Variety reported Paramount as saying it wants the HBO brand to operate with independence.
“We do plan to put the two services together, which today gives us a little over 200 million direct to consumer subscribers,” said Ellison on the investor call, as reported by Variety. “We think that really positions us to compete with the leaders in the space. At Paramount, by the middle of this year, we’ll have completed the consolidation of our three services under one unified stack, and you can see us taking a similar approach to this platform going forward.”