Skydance Corporation closed its $110 billion takeover of Warner Bros. Discovery on Tuesday and began trading on the New York Stock Exchange with an estimated $80 billion in debt, a load that has made Wall Street wary of the new media giant.
Shares of the combined company, listed as SKYD, ended their first session at $9.53, down 2.5%. Warner Bros. Discovery stock stopped trading on Nasdaq. WBD shareholders received $31.02 in cash per share.
Apollo Global Management, Bank of America and Citigroup raised roughly $52 billion in a week to fund the deal, according to Bloomberg. The package included about $30 billion in investment-grade bonds, $12.4 billion in junk bonds and $9.46 billion in loans. Skydance Chief Financial Officer Dennis Cinelli played down a rocky market reception, calling it “one-day choppiness” and saying the company was pursuing a transformative transaction rather than a quick trade. A Citigroup executive said the financing worked out well given the volatile conditions.
Analysts remain unconvinced. Paramount Skydance shares have fallen about 35% since Warner Bros. accepted the offer in late February. Before the deal, the company’s operating earnings covered its interest bill only 2.6 times, a thin margin that now supports a far larger obligation.
The merger puts Paramount+ and HBO Max under one roof, alongside CBS, CNN, HBO and a slate of cable networks. The company has set a target of $6 billion in cost savings within three years, a goal that signals job cuts across both organizations.
Regulatory resistance ended only days before the close. A federal judge approved a settlement with 12 state attorneys general who had sued on antitrust grounds. Under the consent decree, the company must raise domestic production spending by at least $300 million a year above 2025 levels. It also cannot sell or shut the Paramount or Warner Bros. studio lots. A group of Paramount customers filed a last-minute petition to block the deal, arguing it still harms competition.
Warner Bros. Discovery CEO David Zaslav stands to collect roughly $887 million. David Ellison, who leads the combined company, called the day historic for Skydance and the industry.
