Warner Bros. Discovery's sale to Skydance: from the 2025 Netflix deal to the 2026 closing and its conditions

On October 6, 2026, Skydance Corporation, named Paramount Skydance Corporation until that day, completed its acquisition of Warner Bros. Discovery, the owner of HBO Max, HBO, CNN and the Warner Bros. studio. Its announcement was datelined Los Angeles and New York. WBD shareholders received $31.01666668 a share in cash, and WBD put the aggregate merger consideration at approximately $78 billion. The deal ended a contest that began in December 2025, when Netflix agreed to buy its studios and streaming businesses, and it closed only after a federal court entered a consent decree with 12 states that sets conditions on films, streaming windows, news and the free service Pluto TV for five years.

Netflix first, then Paramount

On December 4, 2025, WBD signed a merger agreement with Netflix. Netflix was to acquire WBD's Streaming & Studios businesses after WBD spun off its Global Linear Networks business to its own shareholders. Each WBD share was to receive $23.25 in cash plus Netflix stock, with the number of shares set by Netflix's average share price shortly before closing. WBD would owe Netflix $2.8 billion if it walked away for a better offer; Netflix would owe WBD $5.8 billion if regulators blocked the deal.

Paramount Skydance went straight to shareholders. On December 8, 2025, it launched a tender offer of $30.00 a share in cash for all of WBD, and on December 16 WBD's board unanimously decided to recommend rejecting it and backing the Netflix agreement. WBD and Netflix amended their agreement on January 19, 2026. After WBD's board determined that a new Paramount Skydance proposal was superior and Netflix waived its right to respond with revised terms, WBD terminated the Netflix agreement on February 27, and Paramount Skydance paid Netflix the $2.8 billion termination fee on WBD's behalf. The same day, WBD signed with Paramount Skydance at $31.00 a share in cash, plus about $0.0028 a share for each day after September 30, 2026, that closing took.

The equity came largely from the Ellison family. A Lawrence J. Ellison trust agreed to buy up to $46.72 billion of Paramount Skydance Class B stock and RedBird Capital Partners $250 million, according to WBD's February filing. Skydance's latest quarterly report says entities controlled by Lawrence J. Ellison and David Ellison indirectly hold about 77.5% of its voting Class A stock.

Shareholders, states and the courts

WBD shareholders approved the merger at a special meeting on April 23, 2026, by 1,742,843,087 votes to 16,260,135, with 2,371,121 abstentions. In a separate advisory vote, they rejected the merger-related pay of WBD's top executives, by 1,444,387,748 votes to 307,742,302.

In July 2026, California, Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon and Washington sued in the U.S. District Court for the Northern District of California, bringing a claim under Section 7 of the Clayton Act to block it. The court granted a temporary restraining order on July 20, and on July 24 the parties agreed that the deal would not close until five days after a ruling on the merits or June 1, 2027, whichever came first; a trial was set for March 2027. The Writers Guild of America, which had also sued, settled on September 21. That day the states and the companies filed a proposed consent decree, which the court entered on September 30, lifting the bar on closing. Skydance says the deal closed after all required regulatory approvals and that competition authorities in nearly 70 jurisdictions approved it.

What the consent decree requires

The decree runs for five years and, according to the filing, is not an admission that the combined company broke any antitrust law. Its main commitments, as Paramount Skydance summarized them in its filing of September 30, 2026:

• Theatrical films: at least 30 U.S. releases in each of the first two years and 32 in each of the next three, including at least 20, then 21, wide releases on 2,000 or more screens, and at least four independent films a year.
• Windows: each counted film must have a theatrical window of at least 45 days, may not be marketed as available on premium video-on-demand or any streaming platform before day 30 of that window, and may not reach a subscription streaming service until at least 90 days after its first U.S. theatrical showing.
• Shortfalls: a $30 million contribution to designated industry and attorneys-general funds for each film below the annual minimum, and divestiture of Miramax Studios if release commitments are missed after a six-month cure period and other procedures.
• Cable: terms for the two companies' basic cable channels must be negotiated separately, with neither portfolio's terms tied to the other's; an uncured material breach would require divesting BET, VH1, Comedy Central, Smithsonian, Destination America and Science.
• Production and jobs: at least $300 million a year more spent on U.S. production than the two companies' combined 2025 levels, neither the Paramount nor the Warner Bros. studio lot sold or closed, and existing union agreements honored.
• News and free streaming: a five-member News Editorial Independence Board of established journalists for CBS News and CNN within 180 days of closing, and Pluto TV, or a successor or substantially equivalent replacement, kept as a free, ad-supported streaming service at or above the service and quality levels in effect when the decree took effect.

The states had gone to court under the Clayton Act to block the merger, and the decree settled their suit. Skydance says the combination “will strengthen competition and expand consumer choice,” while its quarterly report warns investors that the decree's commitments “restrict how and when we release films and will increase our costs.”

What applies now

WBD is now a wholly owned subsidiary of Skydance. Its shares stopped trading on Nasdaq on the closing date, and Skydance's Class B shares have traded on the New York Stock Exchange as SKYD since October 6. Chief executive David Zaslav left WBD that day. Skydance's quarterly report for the period ended September 30, 2026, filed on November 9, lists HBO Max, HBO, CNN, TNT Sports and Warner Bros. among its brands after the merger; its financial statements for that quarter cover the period before the merger.

Skydance's closing announcement says its direct-to-consumer streaming products “will unify into a single service over time,” and gives no date for that. The decree's commitments on theater windows, Pluto TV and news run for its five-year term. A separate antitrust suit by five consumers, filed in April 2026 to block the deal, was dismissed on October 21, and on November 2 the court denied their request for an order to keep the acquired businesses separate, Skydance reports.