Godfather Meets Barbie? Paramount Skydance in Talks to Acquire Warner Bros., Reshaping Hollywood

TradingKey - The global entertainment industry and financial markets are closely watching a potential blockbuster consolidation: Paramount Skydance’s proposed acquisition of Warner Bros. Discovery (WBD). If completed, this would be the largest Hollywood merger since Disney’s 2019 acquisition of 21st Century Fox, sparking visions of cinematic universes colliding — from The Godfather meeting Harry Potter, to Mission: Impossible facing off against Batman.

According to The Wall Street Journal, citing people familiar with the matter, Paramount Skydance is preparing a takeover bid for its rival Warner Bros. Discovery, in a deal expected to be mostly cash-financed and backed by the Ellison family.

Following news of the potential deal, Paramount’s stock (PSKY) surged 15.55% on September 11, while Warner Bros. (WBD) jumped as high as 36% intraday, closing up 28.95%.

The sharp rally reflects strong investor enthusiasm — especially amid ongoing challenges facing traditional media from streaming rivals.

This development comes just three months after Warner Bros. announced plans to split into two independent public companies. In June, WBD revealed it would separate into one entity focused on cable TV and another on streaming and studio operations. However, Paramount’s reported offer targets the entire company, not just one of the soon-to-be-split units.

Just weeks ago, David Ellison’s Skydance completed an $8.4 billion merger with Paramount, taking control of the newly combined Paramount Skydance.

Notably, David Ellison is the son of Larry Ellison, CEO of Oracle and a man who recently saw his net worth surge, briefly making him the world’s richest person. The Ellison family is now poised to back this new bid. 

The deal could face antitrust scrutiny, but Larry Ellison’s long-standing ties to President Donald Trump may help navigate regulatory hurdles.

According to NBC News, discussions between Paramount and Warner Bros. have already taken place. If finalized, this would mark a historic union of two of Hollywood’s most iconic studios — potentially becoming the largest entertainment deal since Disney’s $71 billion acquisition of Fox’s entertainment assets in 2019.

Both companies own major film and TV studios, cable networks, and streaming platforms:

• Paramount: CBS, MTV, Nickelodeon, and Paramount+
• Warner Bros.: CNN, TBS, TNT, HBO, and HBO Max

They also possess vast libraries of iconic intellectual property (IP):

• Paramount: Mission: Impossible, The Godfather, Yellowstone
• Warner Bros.: Harry Potter, Batman, Superman, Barbie, SpongeBob SquarePants

eMarketer analysts said that this deal is the Hollywood equivalent of a sequel no one expected but everyone sort of saw coming.

Behind this bid is the mounting pressure on traditional media from streaming giants. Legacy players face fierce competition not only from Netflix, Disney, and Comcast, but also from Amazon and Apple, all of which operate powerful streaming services. 

As TV viewership and ad revenue decline, these companies are seeking survival through consolidation.

Although the prospective buyer, Paramount Skydance, has a market cap of $19.3 billion — less than half of Warner Bros.’ $40 billion valuation — the financial firepower of the Ellison family makes the deal feasible.

Huber Research analysts stated that this is a doable deal, and it might even make sense. The Ellison family has the cash, and everyone is talking about studio and streaming consolidation.