REGULATORY · COMPETITIVE · USA
Warner Bros Discovery acquisition by Paramount Skydance
Change
Warner Bros Discovery signed a $110B acquisition agreement with Paramount Skydance on Feb. 27, 2026, after Netflix declined to match the PSKY offer, with the revised bid raising the regulatory-failure termination fee to $7B (from $5.8B) and including about $29B of debt.
Why it matters
The agreement being signed (per an internal townhall audio reviewed by Reuters) moves the transaction from bidding to execution, making regulatory clearance the primary gating item. Paramount Skydance increased the termination fee to $7B if approval is not obtained, raising the financial stakes of a failed review versus the prior $5.8B. The deal structure includes roughly $29B in debt, which can constrain post-close capital allocation and financing terms. With Netflix opting not to match, the competitive set for the asset has narrowed, reducing near-term bid uncertainty. If completed, the merged entity would control a larger combined film/TV IP library, affecting licensing availability and pricing for counterparties.
Implications
- • Regulatory approval becomes the key constraint; failure triggers a $7B termination fee.
- • ~$29B of deal debt increases leverage and can tighten financing flexibility post-close.
- • Consolidated IP ownership can shift licensing terms for streamers and broadcasters.
- • Bid uncertainty reduced after Netflix declined to match the offer.
Who is affected
- • Warner Bros Discovery shareholders, bondholders, and employees
- • Paramount Skydance management and financing counterparties
- • Streaming platforms and broadcasters licensing Warner/Paramount content
- • Antitrust and media regulators reviewing the transaction
Source
Topics
Law & Public Safety Intellectual Property Business & Markets Mergers & Acquisitions Technology & Innovation Big Tech