On October 6, 2026, Paramount Skydance acquired Warner Bros. Discovery (WBD) for $31 per share, valuing the company at $110.9 billion, with the combined company renamed Skydance. The acquisition was funded by the Ellison family and RedBird Capital Partners, with additional funding being provided by the sovereign wealth funds of Saudi Arabia, Qatar, and the United Arab Emirates (which hold non-voting shares in the company). WBD had originally planned to spin off its less profitable linear television assets as a new company, leaving the flagship Warner Bros. studio and streaming businesses. After Paramount Skydance began making unsolicited offers to acquire WBD as a whole, its board of directors placed the company up for auction; in December 2025, WBD initially accepted an $82.7 billion offer by Netflix, Inc. to acquire the WB studios and streaming business, with the remaining assets continuing as a spin-off known as Discovery Global.
Paramount continued to make unsolicited offers for WBD into 2026, arguing that its offer provided better shareholder value than that of Netflix, would give Paramount and WBD the scale needed to compete with tech companies while preserving a commitment to the cinema industry, and would face less antitrust scrutiny due to Netflix's projected subscription video on demand (SVOD) market share post-acquisition. Paramount CEO David Ellison stated that the combined company would release at least 30 films per year, and maintain the creative independence of divisions such as HBO. On April 23, 2026, WBD shareholders approved a revised offer by Paramount at $31 per share, including an agreement to pay Netflix's breakup fee, and pay an ongoing penalty to WBD shareholders if the sale was not completed by a specific deadline.
Politicians and members of the film industry expressed concern over the resulting scale of the company, its potential impact on jobs, movie theaters, and cable television. Concerns were also raised over the Ellison family's relationship with the Trump administration, its potential influence on the editorial operations of CNN, and the backing of the acquisition by Middle-Eastern wealth funds. The acquisition was approved by the U.S. Department of Justice on June 12, 2026, with no major concessions. The European Commission imposed conditions requiring Paramount to exit its United International Pictures distribution venture with Universal Pictures, while the United Kingdom is requiring that its individual news and children's businesses maintain editorial independence, and will prohibit the combination of its linear and on-demand services for five years.
The completion of the acquisition was delayed by a federal antitrust lawsuit from California and eleven other states, which sought antitrust remedies due to the combined company's total market share of box office and cable television revenue. The Writers Guild of America (WGA) also filed a similar suit. Paramount negotiated a five-year consent decree to resolve the California lawsuit, mandating specific investments towards film production and acquisition, restrictions on its engagement with film exhibitors and television providers, and the establishment of an independent board to oversee the editorial integrity and independence of CBS News and CNN post-acquisition, among other conditions. Amid concerns that the antitrust remedies were not strong enough to address the original concerns, the settlement was approved by the court on September 30, 2026, and the acquisition was completed on October 6, 2026.
The combined company—renamed Skydance Corporation—is led by Ellison and former Mattel executive Ynon Kreiz as co-CEOs; its holdings include two of the five major film studios (Warner Bros. Pictures, Paramount Pictures and related assets such as DC Entertainment), streaming services (such as HBO Max, Paramount+, Philo, and Pluto TV), television studios (CBS Studios, Paramount Television Studios, and Warner Bros. Television Studios), various television networks and cable channels (including the CBS broadcast network; legacy Turner brands such as TBS, TNT, CNN, and Adult Swim; legacy Discovery Inc./Scripps channels such as its namesake, HGTV, and Food Network; legacy Paramount cable networks such as BET, Comedy Central, MTV, and Paramount Network; children's brands Cartoon Network and Nickelodeon; pay television brands HBO and Showtime; and various international television channels), as well as sports divisions (CBS Sports and TNT Sports).
On October 6, 2026, Paramount Skydance acquired Warner Bros. Discovery (WBD) for $31 per share, valuing the company at $110.9 billion, with the combined company renamed Skydance. The acquisition was funded by the Ellison family and RedBird Capital Partners, with additional funding being provided by the sovereign wealth funds of Saudi Arabia, Qatar, and the United Arab Emirates (which hold non-voting shares in the company). WBD had originally planned to spin off its less profitable linear television assets as a new company, leaving the flagship Warner Bros. studio and streaming businesses. After Paramount Skydance began making unsolicited offers to acquire WBD as a whole, its board of directors placed the company up for auction; in December 2025, WBD initially accepted an $82.7 billion offer by Netflix, Inc. to acquire the WB studios and streaming business, with the remaining assets continuing as a spin-off known as Discovery Global.
Paramount continued to make unsolicited offers for WBD into 2026, arguing that its offer provided better shareholder value than that of Netflix, would give Paramount and WBD the scale needed to compete with tech companies while preserving a commitment to the cinema industry, and would face less antitrust scrutiny due to Netflix's projected subscription video on demand (SVOD) market share post-acquisition. Paramount CEO David Ellison stated that the combined company would release at least 30 films per year, and maintain the creative independence of divisions such as HBO. On April 23, 2026, WBD shareholders approved a revised offer by Paramount at $31 per share, including an agreement to pay Netflix's breakup fee, and pay an ongoing penalty to WBD shareholders if the sale was not completed by a specific deadline.
Politicians and members of the film industry expressed concern over the resulting scale of the company, its potential impact on jobs, movie theaters, and cable television. Concerns were also raised over the Ellison family's relationship with the Trump administration, its potential influence on the editorial operations of CNN, and the backing of the acquisition by Middle-Eastern wealth funds. The acquisition was approved by the U.S. Department of Justice on June 12, 2026, with no major concessions. The European Commission imposed conditions requiring Paramount to exit its United International Pictures distribution venture with Universal Pictures, while the United Kingdom is requiring that its individual news and children's businesses maintain editorial independence, and will prohibit the combination of its linear and on-demand services for five years.
The completion of the acquisition was delayed by a federal antitrust lawsuit from California and eleven other states, which sought antitrust remedies due to the combined company's total market share of box office and cable television revenue. The Writers Guild of America (WGA) also filed a similar suit. Paramount negotiated a five-year consent decree to resolve the California lawsuit, mandating specific investments towards film production and acquisition, restrictions on its engagement with film exhibitors and television providers, and the establishment of an independent board to oversee the editorial integrity and independence of CBS News and CNN post-acquisition, among other conditions. Amid concerns that the antitrust remedies were not strong enough to address the original concerns, the settlement was approved by the court on September 30, 2026, and the acquisition was completed on October 6, 2026.
The combined company—renamed Skydance Corporation—is led by Ellison and former Mattel executive Ynon Kreiz as co-CEOs; its holdings include two of the five major film studios (Warner Bros. Pictures, Paramount Pictures and related assets such as DC Entertainment), streaming services (such as HBO Max, Paramount+, Philo, and Pluto TV), television studios (CBS Studios, Paramount Television Studios, and Warner Bros. Television Studios), various television networks and cable channels (including the CBS broadcast network; legacy Turner brands such as TBS, TNT, CNN, and Adult Swim; legacy Discovery Inc./Scripps channels such as its namesake, HGTV, and Food Network; legacy Paramount cable networks such as BET, Comedy Central, MTV, and Paramount Network; children's brands Cartoon Network and Nickelodeon; pay television brands HBO and Showtime; and various international television channels), as well as sports divisions (CBS Sports and TNT Sports).
Background
WBD was established on April 8, 2022, and created through AT&T's divestment of WarnerMedia and WarnerMedia's subsequent merger with Discovery, Inc., via a Reverse Morris Trust transaction. Through the agreement, Discovery executives would assume majority control over the merged company, while AT&T would no longer hold any ownership interest. AT&T attempted to reinvent itself as a major player in the entertainment industry through acquiring Time Warner and DirecTV, but later reversed course after losses and unsuccessful synergies. Issues facing WBD were its initial debt load of over $43 billion and heavy market devaluation of its stock, with it losing over 60% of its value by early 2025. To bring down debt, WBD began undertaking strict cost-cutting strategies that included corporate reorganization, controversial tax write-offs, and the removal of dozens of movies and television shows from HBO Max. Despite these efforts, the linear cable networks of WBD continued to lag behind in profits compared to the more profitable streaming and studios businesses.
On December 12, 2024, WBD restructured its operations into two divisions: Streaming & Studios and Global Linear Networks. WBD president and CEO David Zaslav said the new structure would provide "flexibility with potential future strategic opportunities." On June 9, 2025, WBD announced plans to separate into two companies by mid-2026. The successor companies would have been named "Warner Bros.", comprising the Streaming & Studios division, and "Discovery Global", comprising the Global Linear Networks division. Industry analysts offered mixed assessments of the announcement. Some characterized it as an acknowledgment that the 2022 Warner Bros. Discovery merger had underperformed, while others suggested that the separation could make Warner Bros. a more attractive acquisition target for larger companies that were uninterested in its cable networks.
Initial bidding war
In September 2025, Paramount Skydance CEO David Ellison convened a board meeting to discuss a possible acquisition of WBD, a move reported as intended to strengthen Paramount's competitive position against Amazon, Disney, and Netflix. Several days later, Ellison met with Zaslav at his home to propose a cash-and-stock bid of $19 per share. The offer was formalized in a subsequent letter that set the cash component at 60%. Later in September, Paramount Skydance raised its offer to $22 per share with a 67% cash component, a $2 billion reverse-termination fee payable if the deal failed to clear regulatory review, and a provision for Zaslav to remain as co-CEO and co-chairman of the combined company. On October 13, 2025, Paramount Skydance submitted a third offer, raising the bid to $23.50 per share with an 80% cash component. WBD continued to reject Paramount's proposals. An analyst suggested that the bid was meant to preempt potential interest in the studio's business post-split, and take advantage of a "period of industry-wide instability".
After Paramount's three failed attempts, talks of a potential sale of WBD began circulating in October, and the company announced it was reviewing strategic alternatives to its previously announced plan to split into two companies after receiving unsolicited interest from multiple parties. On October 30, 2025, Netflix, Inc. was reported to be actively exploring a bid for the Streaming & Studios unit; the company stressed that it remained "predominantly focused on growing organically", and was not interested in WBD's legacy linear television businesses.
In the first round of non-binding proposals submitted on November 20, 2025, Comcast and Netflix made cash-and-stock and mostly-cash bids for the Streaming & Studios unit, respectively, while Paramount Skydance made an all-cash offer for the entirety of WBD at $25.50 per share, backed by debt financing from Apollo Global Management and Middle-Eastern sovereign wealth funds. Starz submitted a $25 billion bid for the Global Linear Networks division and 20% of the Streaming & Studios division.
After the initial round of bids, WBD solicited a second round of bids. On December 1, 2025, Netflix, Paramount and Comcast all once again submitted binding second-round bids, with Paramount submitting an all-cash $26.50 per share offer for the entire company. After the auction process concluded in December, Standard General was approached by Warner Bros. Discovery shareholders about a potential acquisition of WBD's Global Linear Networks division.
As the process moved to a final decision, Paramount sent a letter to Zaslav alleging that the sale had become "tilted" in favor of Netflix. The letter claimed that the WBD board had embarked on "a myopic process with a predetermined outcome", pointing to alleged conflicts of interest regarding the friendship of Zaslav and Netflix co-CEO Ted Sarandos and questioning whether the auction remained fair.
Netflix agreement
On December 5, 2025, multiple news outlets reported that Netflix had emerged as the leading bidder and had entered exclusive negotiations with WBD to acquire its studio and streaming business, despite objections from Paramount Skydance. Netflix announced the acquisition shortly after, which valued WBD at $82.7 billion enterprise value ($72.0 billion equity value and $59 billion of debt from Wells Fargo, HSBC, and BNP Paribas), and priced post-split Warner Bros. shares at US$27.75. The acquisition would mark a departure from Netflix's stated "builders, not buyers" strategy and a shift toward growth through acquisition. Analysts had not widely anticipated Netflix's participation in the auction process prior to the December reports. Analysts also estimated that a merged Netflix–Warner Bros. entity would have controlled 30.3% of the U.S. streaming market.
Opponents of the acquisition, including trade unions such as the Writers Guild of America and Directors Guild of America, warned that combining WBD's film and television library with Netflix's streaming platform could increase market concentration, reduce competition, and limit creative diversity by consolidating control over content production, distribution, and release strategies within a single company, threatening competitive opportunities for talent. SAG-AFTRA stated that its final position would depend on a full review of the proposal, but assessed that any merger should increase production and protect jobs.
Cinema United—a trade association representing the U.S. cinema industry—raised concerns that Netflix would not support the theatrical release of Warner Bros. films, estimating a potential loss of 25% of domestic box office revenue attributed to its releases. The Committee for the First Amendment described the deal as an "alarming escalation of the consolidation that threatens the entire entertainment industry, the democratic public it serves and the First Amendment", and called upon regulators to ensure that they "categorically refrain from using [their] power to extract political concessions that influence content decisions or chill free speech."
On December 8, 2025, Paramount launched a hostile all-cash offer of $30 per-share for WBD, valuing the company at about $108.4 billion in enterprise value. The bid included equity backing from investors such as the Ellison family and RedBird Capital and debt commitments from major banks, and Paramount said the combined company would be a more competitive media and streaming business than alternatives under consideration. WBD's board said it would review the proposal in accordance with its fiduciary duties and existing agreements. Reports indicated that WBD's board planned to recommend shareholders reject the Paramount Skydance offer in favor of its agreement with Netflix, citing greater certainty and financial terms. The board subsequently rejected the bid and advised shareholders accordingly, while Paramount Skydance said it remained committed to pursuing the acquisition. Around the same time, Affinity Partners withdrew from participating in Paramount's financing consortium.
Paramount argued that its bid would face fewer regulatory and antitrust obstacles than the Netflix deal, as a combination of Netflix and HBO Max would have represented about 43% of global subscription video-on-demand subscribers. The company also accused Netflix of "obfuscat[ing] its dominant position in streaming" by counting social networks such as Facebook, TikTok, and YouTube as part of its competition, reflecting "neither reality nor the historical practice of competition enforcers." It also warned that the Netflix deal would likely lead to fewer theatrical film releases, referring to public statements by Netflix executives who questioned the long-term role of movie theaters. In contrast, Paramount stated that it planned to increase its output to at least 30 theatrical films per-year if it acquired WBD.
Netflix co-CEO Ted Sarandos rebuked Paramount's comments, noting that Netflix had made over 30 theatrical releases in 2026, but that he primarily had an issue with theatrical windows that were not "consumer-friendly". It was noted that most of Netflix's theatrical releases had either been limited releases intended primarily to secure awards eligibility, or alternative programming (such as a sing-along version of KPop Demon Hunters, and event screenings of the Stranger Thingsseries finale) that are not subject to theatrical windows. Sarandos later stated that Warner Bros. would operate "largely like it is today" and maintain a 45-day theatrical window for its releases if it were acquired by Netflix, as the studio generated "billions of dollars of theatrical revenue that we don't want to put at risk".
After the board of WBD endorsed Netflix's lower but previously signed agreement instead of a higher all-cash offer from Paramount Skydance, the company filed suit in the Delaware Court of Chancery. The complaint asked the court to require WBD to provide additional details about its decision-making process, including how it assessed the Netflix transaction, valued its remaining "Global Networks" business, and evaluated the risks and pricing of Paramount's competing tender offer. At the same time, Paramount indicated that it was prepared to pursue a proxy fight. The company announced plans to nominate its own slate of directors to WBD's board in an effort to encourage shareholders to support Paramount's bid rather than the agreement with Netflix.
During the litigation, Paramount Skydance asked WBD for more disclosure about valuations, debt assumptions, adviser analyses, and the board's reasoning for favoring the Netflix deal over Paramount's offer, as part of litigation tied to its takeover attempt. The Delaware Court of Chancery declined to grant Paramount Skydance's request for expedited proceedings, but instead accepted to grant Netflix's request for expedited proceedings. The court's decision allowed WBD to continue pursuing the Netflix deal while Paramount Skydance's litigation proceeded on a standard timetable. On January 13, 2026, Netflix amended its bid from a cash-and-stock deal to all-cash, while maintaining its $27.75 per share price.
On January 22, 2026, the U.S. Department of Justice (DOJ) launched an antitrust review of Netflix's proposed deal. WBD disclosed in a regulatory filing that both companies had received a formal "second request" for information from the DOJ's Antitrust Division on January 16, which paused the statutory waiting period and prevented the transaction from closing pending further review. The second request signaled heightened scrutiny of whether the transaction could lessen competition in streaming, film production, or television distribution markets.