October 9, 2026

Skydance Closes Paramount and Warner Bros. Discovery Deal

David Ellison's Skydance has closed the Paramount and WBD deal, bringing together HBO, Paramount+ and CBS. The debt stands at $80 billion, and the CEOs confirmed that staff cuts are inevitable.

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Layoffs on the Way as Skydance Now Controls Paramount and WBDAI-generated

The merger of Paramount and Warner Bros. Discovery (WBD) under the wing of Skydance officially closed on Tuesday morning. The new conglomerate, carrying around $80 billion in debt, is preparing for staff cuts — CEO David Ellison and his co-CEO Ynon Kreiz confirmed that layoffs are inevitable as the companies consolidate.

"Bringing the two companies together will bring changes, including difficult decisions that will affect our employees. We are committed to conducting this process thoughtfully and with respect," Ellison and Kreiz said in a message to staff.

What is included in the new conglomerate?

The largest assets of both companies now operate under a single umbrella:

Paramount Studios and Warner Bros. Studios film studios;
HBO, HBO Max and Paramount+ streaming services;
CBS, CBS Sports, TBS, TNT, CNN television channels;
Pluto TV, Discovery, MTV, BET, Nickelodeon and dozens of other linear channels.

David Ellison heads the combined company, with Ynon Kreiz as his co-chair. At a meeting with employees on the day the deal closed, the executives said that creating great stories would be at the core of "everything we do."

How did Skydance win the battle against Netflix?

The road to the merger was not smooth. In early 2026, Ellison had to wrest WBD from the hands of Netflix — the streaming giant had initially sought to buy Warner Bros. Studios itself, leaving the linear assets to form a separate company.

Skydance won with an offer that WBD officially called "superior": the deal provided for payment entirely in cash at $31 per share.

Who tried to block the deal?

After the price was agreed, an attempt was made to stop the deal in court. The lawsuit was filed by the attorneys general of several states together with the Writers Guild of America.

The parties settled the dispute in September. The settlement includes:

commitments on film production volumes;
an independent board to ensure the editorial independence of CNN and CBS News.

What will happen to the $80 billion debt?

The new conglomerate inherited roughly $80 billion in debt that now needs to be reduced. Management sees layoffs as one of the easiest ways to cut costs — they became the first expected consequence of the deal's closure.

The leadership has not yet announced the number of positions to be cut or a timeline. However, Ellison and Kreiz's admission that "difficult decisions" would affect staff effectively confirmed plans for restructuring immediately after the integration of the two companies began.

Source: Adweek

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