Netflix had four business days to save the deal. It needed less than four hours to walk away. On February 27, Paramount Skydance signed a definitive agreement to acquire Warner Bros. Discovery — owner of HBO, CNN, and the DC Universe — for $31 per share in an all-cash offer valued at roughly $111 billion including debt.
The man behind the deal is David Ellison, the 43-year-old son of Oracle billionaire Larry Ellison. Just eight months after completing his takeover of Paramount, he is now attempting something no one has pulled off since the golden age of the studio system: uniting two of Hollywood’s “Big Five” film studios under one roof.
A Hostile Takeover That Worked
Warner Bros. Discovery had been bleeding value since its troubled 2022 merger. By mid-2025 the company announced a corporate split, effectively putting its crown-jewel studios on the auction block. Netflix struck first, signing a $72 billion deal in December to buy the studios and streaming assets while leaving cable networks behind.
Paramount launched a hostile counter-offer for the entire company — cable channels, CNN, and all — and spent months raising the price across nine separate bids. The WBD board rejected offer after offer before finally declaring Paramount’s latest proposal “superior.” Netflix walked away with a $2.8 billion termination fee and a 14% stock surge.
Gulf Money, Senate Alarm
What makes this more than a Hollywood story is where the money comes from. Some $24 billion of the financing is supplied by sovereign wealth funds from Saudi Arabia, Qatar, and Abu Dhabi — Gulf states aggressively diversifying beyond oil into global media. Saudi Arabia’s Public Investment Fund is controlled by Crown Prince Mohammed bin Salman, whom U.S. intelligence agencies have linked to the 2018 killing of Washington Post journalist Jamal Khashoggi.
Paramount insists these investors hold no governance rights, no board seats, and no editorial influence. Democratic senators Elizabeth Warren and Richard Blumenthal are unconvinced, accusing the Trump administration of failing to trigger a national security review through the Committee on Foreign Investment. Republican voices have been largely quiet on the foreign capital question, though Trump himself previously said he wanted CNN sold.
The CNN Question No One Can Answer
No single aspect of the merger generates more anxiety than CNN’s future. The network will pass into a company already in the middle of a contentious editorial overhaul at CBS News, where Ellison installed Bari Weiss — founder of The Free Press and a vocal critic of mainstream media bias — as editor-in-chief.
Since her arrival, Anderson Cooper departed from 60 Minutes, multiple producers have resigned, and Weiss drew sharp criticism for temporarily shelving a segment about Venezuelan deportees held in El Salvador’s CECOT prison. The segment eventually aired, but the episode reinforced fears that editorial decisions at CBS are being shaped by the company’s relationship with the Trump White House.
Two Sides of Bari Weiss
Supporters argue Weiss is modernizing a stale broadcast model and broadening CBS’s appeal beyond a shrinking liberal audience. Ellison himself says the goal is to serve the 70% of Americans who fall between centre-left and centre-right. Critics counter that the pattern speaks for itself: Paramount settled a Trump lawsuit for $16 million, cancelled Stephen Colbert’s late-night show, and Ellison reportedly assured Trump officials that “sweeping changes” would come to CNN.
A Mountain of Debt Behind the Marquee
Beyond the politics sits a financial reality that may matter even more. The combined entity will carry a projected debt-to-EBITDA ratio of 4.3 times at closing, with a near-$79 billion debt pile that has already prompted credit agencies to downgrade the company to junk status. Paramount is targeting $6 billion in annual cost synergies — a figure analysts say will translate into more than 5,000 layoffs across both companies.
Whether the creative output of two once-great studios can survive the pressure of deleveraging on that scale is the question that will define this merger’s legacy. Hollywood has been here before, and the answer has rarely been encouraging.