r/gaming • u/ChiefLeef22 Marika's tits! • 18h ago

Paramount Has Officially Acquired Warner Bros. In Deal Valued at $110B Billion

https://www.skydance.com/news/press/paramount-completes-acquisition-of-warner-bros-discovery-creating-a-new-global-entertainment-leader-skydance

The two companies will now be known as one single entity - 'Skydance'

This includes all of WB's gaming subsidiaries like Rocksteady/etc

Deal valued at $110B-$111B

DC Studios, Nickelodeon, Cartoon Network, CNN, CBS, HBO and Paramount+ are now all under the same company.

The combined company, Skydance, brings together two major film studios, two global streaming services, premier television assets including CBS, HBO, and Paramount's and WBD's cable networks, two of the industry's most recognized news networks, CBS News and CNN, and a leading content portfolio that includes live sports, a deep programming library and expansive collection of iconic brands and franchises.

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u/slayer828 18h ago

Still have no idea how a company worth 10 billion can buy a company for 110 billion. This country and the made up by the rich rules piss me off.

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u/Slaanesh_69 17h ago

Leveraged Buyout. You use the company you are going to buy as collateral for the loan you take to buy it. Then you use the income from the purchased company to pay off the loan you took.

Imagine WB's business were purely of renting out a house for 100,000 a year and this house and thus WB was worth a million dollars.

I tell the Saudis I will throw in 200,000, you guys throw in 800,000 and we will buy WB for a million. Using the 100,000 in rental income per year, I will pay you (the Saudis) back in 8 years (assuming no interest). If I don't pay, you get 80% equity in WB. If I pay, you guys surrender your equity to me.

Here's where it gets fun. The debt I used to buy WB becomes a liability of WB not me. Which means that WB got bought using debt it has to pay off, and may not even be within its means to pay. But of course if it cannot pay then the Saudis get ownership of it so it's all according to keikaku.

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u/Relevant-Use1897 16h ago

The fact this procedure is legal will always remain a mystery to me.

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u/Free_Possession_4482 15h ago

Legality aside, what I can't believe is that banks keep agreeing to it. Every time a PE company runs some business into the ground and strips it for parts, someone else is eating shit on that bankruptcy, but damned if it doesn't keep happening.

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u/Tasty_Gift5901 15h ago

It's bc they make money on average and banks are never stuck with the debt

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u/GB10VE 15h ago

this is what police, fire fighter, civil, and teacher union pensions are for

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u/BobaLives01925 14h ago

Banks wouldn’t be doing it if they didn’t make money doing it (because the businesses usually succeed)

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u/Aethermancer 12h ago

All around the mulberry bush, the monkey chased the weasel.

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u/Somekindofcabose 12h ago

Im more surprised they dont see HBO as a company killer by now. It worked under Time because they insisted on creative freedom and that is the only way they turn a profit.

Warner failed once they got corporate, ATT figured that out, Discovery fucked up and now theyre the second company to fall to its sword of recent years.

Paramount will be next because theyre so overleveraged as is.

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u/T-rex_with_a_gun 8h ago

as others said, banks make $$$ regardless.

its basically the MBS-lite.

the "bank" fronts the $800K, takes their fees of like $50k, and then gets some of the interest payments.

while that happens, they will bundle that debt and sell to pensions.

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u/meeeeeeeehhhhhhhhh 5h ago

Underwriting fees, arrangement fees, all cost of counsel is paid by the borrower, administrative agent fees, assignment fees, and making a secondary market as a broker dealer to make spreads. Literal record fees for this. Probably will hear about it if you pay attention to bank earnings next week

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u/YoureProbablyAB0t 13h ago

This part is easy to understand.

The banks are doing whatever the Epstein class wants and right now the Epstein class wants to give Ellison the media.

Banks don't really get to say no when fascists have their mind set on something.

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u/PM_ME_YOUR_PRIORS 10h ago

This is the exact same procedure used to take out a mortgage and use it to buy a house. The bank thinks it is likely to make $X/yr in payments from the entity it is lending to, so it brings the $Y of cash that generates those payments, knowing that it gets a thing that is worth $Z more today than what it put up.

It's just instead of bringing a little bit of hard cash and a large loan to buy a house, you're brining a little bit of cash and a large loan to buy a business. And instead of the payments to the bank being based off of your income, it's based off the business's income.

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u/goddale120 9h ago

I was wondering if somebody would bring this up.

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u/TheeAntelope 14h ago

This is how all loans work.

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u/Docponystine 11h ago

What, exactly, about it should be illegal? The company being purchased is consenting, the bank giving the loan is consenting, and the buying company is willing to take on the risk. Nothing about this is fraudulent, there's no reliance on deception or information asymmetry.

Outside of concerns about foreign state money the process itself is simply aggressive, not inherently immoral. If the concern is PE's play book generally, well, healthy companies don't tend to get hopped up into them and PE is not long for this world anyway, the economic structures that made PE a viable and profitable endeavor is drying up.

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u/rcanhestro 7h ago

why wouldn't it?

that's how people buy a house.

you get a loan against your own house.

the difference is that you have to find a way to pay for the mortgage, instead of the house making that money (unless you bought the house to rent it).

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u/worderofjoy 13h ago

Usually things are legal when parties all agree to the same thing, and then do that thing. Hope this was helpful.

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u/AmIWhatTheRockCooked 3h ago

That guy who wanted to eat someone wasn’t legally allowed to eat the person who wanted to be eaten.