Paramount Closes Mega Warner Bros. Takeover After Dem AGs, Hollywood Actors Attempted To Kill It
Paramount completed its $81 billion acquisition of Warner Bros. Discovery on Tuesday, combining some of Hollywood’s most recognizable studios, television networks and streaming services under a new company called Skydance.
The blockbuster deal puts Warner Bros., HBO, CNN, CBS, Paramount Pictures, HBO Max and Paramount+ under the same corporate roof, along with franchises ranging from “Harry Potter” and “Game of Thrones” to “Top Gun” and “Mission: Impossible.” Including debt, the transaction amounted to nearly $111 billion. The deal closed after 12 Democratic state attorneys general sued to block the merger in July and temporarily won a court order halting it, only to settle with Paramount in September under an agreement requiring additional domestic film production, worker assistance and editorial safeguards for CNN and CBS.
Hollywood actors and filmmakers also fought the merger, with thousands of industry professionals signing an April letter opposing the deal, and actors including Jane Fonda and Mark Ruffalo publicly urging regulators to stop it.
The Department of Justice cleared the transaction in June after concluding it was unlikely to harm competition or American consumers. The Democratic attorneys general sued roughly a month later, alleging the combined company would weaken competition in theatrical film distribution and cable television.
A federal judge temporarily blocked the deal in July before Paramount and the states reached their September settlement. Paramount agreed to spend an additional $1.5 billion on U.S. film production over five years, release at least 30 films in theaters annually and establish new editorial oversight mechanisms for CNN and CBS.
Skydance founder David Ellison will lead the combined company alongside co-CEO Ynon Kreiz, further consolidating some of the country’s biggest entertainment and news properties under one corporate owner.
“Today is a historic day, not just for Skydance but for our entire industry,” Ellison said in a statement Tuesday. “We couldn’t be more excited to get to work.”
Ellison’s Skydance combined with Paramount in August 2025 through a transaction in which the Ellison family and RedBird Capital Partners committed more than $8 billion to acquire Paramount’s controlling shareholder and invest in the new company. Ellison then quickly turned his attention to Warner Bros. Discovery.
Paramount ultimately agreed to pay Warner Bros. shareholders $31 per share following a monthslong bidding war with Netflix. Warner Bros. had initially backed a competing Netflix deal covering its studios and streaming operations before Paramount launched a hostile bid for the entire company.
Netflix eventually dropped out of the race, allowing Paramount and Warner Bros. to reach a merger agreement in February.
The Democratic opposition to the transaction was not unanimous. A source close to Democratic New Jersey Gov. Mikie Sherrill previously told the Daily Caller News Foundation that the governor’s team received no warning before Democratic New Jersey Attorney General Jennifer Davenport joined the lawsuit.
“We didn’t have a heads up,” the source told the DCNF, calling New Jersey’s participation “a baffling move” as the state sought jobs and investment from Paramount and Warner Bros.
“Did we really need to get involved when we’re negotiating such great things for our taxpayers with Paramount and Warner Brothers?” the source said.
The legal battle also threatened to deepen California’s already struggling entertainment-industry exodus. Ellison told senior Paramount executives in August that he was prepared to begin moving the company out of California if Democratic Attorney General Rob Bonta refused to enter settlement negotiations, according to reports at the time.
Ellison’s goal was reportedly to keep the combined company and roughly 30,000 jobs based in Southern California, but he warned executives that Paramount could begin leaving the state once multimillion-dollar daily fees tied to delays in closing the Warner Bros. deal kicked in.
Paramount was later reported to be shopping for roughly 400,000 square feet of office space in Nashville as it weighed shifting operations away from California. Such a move threatened another blow to California’s film industry, which has already struggled with declining local production and entertainment jobs.
The takeover also hands Ellison control of CNN, a network President Donald Trump, who has had warm relations with Ellison and his father, Oracle founder Larry Ellison, has repeatedly criticized over its coverage.
Trump said in December that it was “imperative that CNN be sold,” while Defense Secretary Pete Hegseth said in March that “the sooner David Ellison takes over that network, the better.”
Ellison said CNN would maintain editorial independence, while Mark Thompson will remain the network’s editor-in-chief. The settlement with the Democratic attorneys general also requires the company to establish a News Editorial Independence Board covering CNN and CBS.
Paramount relied on billions of dollars from investors tied to Saudi Arabia, Qatar and the United Arab Emirates to help finance the Warner Bros. acquisition. Saudi Arabia’s Public Investment Fund, the Qatar Investment Authority and Abu Dhabi-based L’imad Holding were among the outside financing partners disclosed by Paramount.
The Federal Communications Commission approved the foreign investors’ indirect ownership interests ahead of the merger. The Gulf investors agreed to forgo voting and governance rights associated with their investments.
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