Paramount completes Warner takeover: mega-merger transforms Hollywood

dpa | A new era is dawning in Hollywood with the traditional studios Paramount and Warner Brothers under one roof. The Paramount Group, controlled by the family of tech billionaire Larry Ellison, completed the $110 billion takeover of Warner.

The new company, called Skydance, now faces a complex integration and must manage a debt burden of tens of billions of dollars. Hollywood fears a wave of job cuts - and liberals in the USA fear political influence from Trump supporter Ellison on the Warner news channel CNN.

Hollywood will be transformed by the deal in a similar way to that caused by Disney's takeover of the 20th Century Fox studio in 2019. The Ellison family only took over Paramount last year. Warner is known for film series such as “Batman”, “Superman” and “Harry Potter”, among others. Paramount is bringing in “Mission: Impossible” and “Star Trek,” among others.

In the months-long struggle over the merger, Paramount promised, among other things, to release at least 30 films from the two studios per year in cinemas in the first two years after the merger. In the three years after that there will be 32 films.

For every film the studios pay less than this, a payment of $30 million is due. In addition, the new umbrella company called Skydance will spend an additional $1.5 billion on productions in the USA over the next five years.

The leading man of the new company is film producer David Ellison, who made a name for himself in recent years with, among other things, the second “Top Gun” film. He is the son of Larry Ellison, whose billion-dollar guarantee made the megadeal possible in the first place.

Shortly before the takeover was completed, Ellison brought Ynon Kreiz, the previous head of the toy giant Mattel, into dual leadership. Ellison will be responsible for strategy, while Kreiz will take care of operations. Investors were promised savings of $6 billion after three years.

CNN's fate received particular attention in debates over the takeover. CNN often reports critically on US President Donald Trump. He often rails against the broadcaster and recently banned him from the White House. Ellison is firmly established in the Trump camp and the Paramount broadcaster CBS adopted a friendlier tone towards the president and his administration after his family took over the company.

Critics of the Warner deal therefore warned that CNN could lose its editorial independence in the hands of the Ellisons. Paramount agreed to form an independent editorial oversight board for CNN. The current editor-in-chief, Mark Thompson, will continue to run the station.

The previous Paramount studio bosses Dana Goldberg and Josh Greenstein are to take over the joint film business. Their Warner counterparts are leaving. In contrast, the previous head of the Warner streaming service HBO Max, Casey Bloys, will lead the new joint business unit with Paramount+.

Netflix had originally reached an agreement with Warner last year to purchase the Hollywood veteran's streaming and studio business. But Paramount didn't give up and made a higher bid for the entire Warner Bros. Discovery company, including television channels such as CNN.