Skydance’s Warner Bros. deal brings a $17 billion Ellison family investment, ambitious cost-cutting and cash-flow targets.

  • David Ellison and his family invested about $17 billion to help finance Paramount Skydance’s acquisition of Warner Bros. Discovery. 
  • Paramount Skydance’s Warner Bros. Discovery deal is valued at about $110 billion and is being funded with a large debt package. 
  • Skydance plans to produce at least 30 movies and 180 TV shows annually. 

Skydance Corp. (SKYD) is drawing attention after CEO David Ellison and his family reportedly invested about $17 billion in the newly formed media giant, highlighting their confidence in the Paramount-Warner Bros. combination as the company begins life following one of Hollywood’s largest mergers. 

Skydance Gets Massive Family Investment

According to a Bloomberg report, David Ellison and his family poured around $17 billion into financing Paramount Skydance Corp.’s blockbuster takeover of Warner Bros. Discovery Inc., making the Ellisons one of the largest financial backers of the newly combined media company.

Ellison and his family had purchased an estimated 1.4 billion shares through an offering priced at $12 each. The investment adds to the billions they previously committed to gaining control of Paramount.

SKYD’s Major Financing Package

The Warner Bros. transaction carried an overall value of about $110 billion. Last week, Paramount Skydance said it is raising a large amount of debt.  The financing includes $30.5 billion in first-priority secured notes, plus $11.4 billion in second-priority dollar notes and €885 million ($1 billion) in euro notes.

Paramount also increased the U.S. portion of its new term loan to $8.5 billion from $7.5 billion. The loan package also includes an €850 million ($963 million) euro loan, with both loans due in 2033.

Three Middle Eastern sovereign wealth funds were expected to provide $24 billion, while RedBird Capital Partners contributed $4 billion and South Korea’s Shinsegae Group supplied another $1 billion, the report said. 

Skydance Eyes $6B In Annual Savings And $10B Free Cash Flow 

Paramount’s acquisition of Warner Bros. Discovery closed on Oct. 6, creating Skydance Corp. The new company owns brands including Paramount, Warner Bros., HBO, CBS, CNN, Paramount+, HBO Max, and Pluto TV, along with several cable networks. It also controls major sports content through CBS Sports and TNT Sports.

Skydance expects the combined company to release at least 30 movies and more than 180 TV shows each year. Its streaming services are also expected to eventually merge into one platform. Skydance expects to cut more than $6 billion in yearly costs within three years and generate more than $10 billion in free cash flow by 2030.

SKYD Stock: Retail View 

On Stocktwits, retail sentiment around the stock plunged from ‘bearish’ to ‘bullish’ the previous day. 

SKYD stock has declined 9% since Oct.6. 

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