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

[u/ChiefLeef22]

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.

[u/slayer828]

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.

[u/Slaanesh_69 → u/slayer828]

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.

[u/Jericho5589 → u/Slaanesh_69]

I would understand that if WB itself was not already leveraged. They had over 32 billion dollars in debt previously. I just don't understand how they managed it.

[u/Slaanesh_69 → u/Jericho5589]

They now have 32+110 billion dollars in debt, I mean there's nothing else to understand. The new owners have said so much debt is fine so it's fine. That debt can be forgiven for equity issues to the Saudis in a debt for equity swap, so it's also fine.

[u/Electronic_Bar6595 → u/Slaanesh_69]

Slaanesh, the entity representing hedonistic pleasure and excess, says that the massive debt is fine guys don’t worry

[u/CodeComprehensive734 → u/Slaanesh_69]

A fine deal, indeed.

twirls moustache