Latham guides on entertainment powerhouse acquisition

The acquisition brings together two of the world’s best-known media and entertainment companies under one brand.

Global law firm Latham & Watkins has advised Skydance (formerly Paramount) on its completed acquisition of Warner Bros. Discovery (WBD), the firm announced this week. The transaction unites the two companies’ film studios, global streaming services, and premier television and live sports portfolios.

The Latham advisory team was led by M&A partners Ian Nussbaum and Max Schleusener, alongside associates Daniel Weissman, Maddy Berg, Jamie Reinah, Emma Giusto, Patrick Frith, Cristina Lombardi, Rheem Brooks and Olivia Cardenas. The team had the support of lawyers from numerous other practices and worked alongside Cravath, Swaine & Moore, which also provided legal advice to Skydance. In addition, Latham provided legal guidance to the investor consortium, which included the Skydance-owning Ellison family.

Los Angeles-based Skydance is a global media and entertainment company comprising three business segments, namely Direct-to-Consumer, TV Media and Studios. Its portfolio brands also include HBO and HBO Max, CBS, CNN, TNT Sports and Nickelodeon, among others.

New York-headquartered Warner Bros. Discovery boasted a significant portfolio of television, film, streaming and gaming brands, content and franchises. The company was formed in 2022 through the merger of WarnerMedia and Discovery.

As a combined company, operating under the name “Skydance”, the global media giant aims to deliver, as a minimum, 30 high-quality theatrical films per year and 180 television shows and series, while placing especial emphasis on creativity and technology.

The bringing together of the two brands is also expected to boost competition and provide greater consumer choice across both the industry and Skydance’s platforms.

The transaction included $47 billion in new equity investment in Class B common stock (led by the Ellison family, RedBird, Public Investment Fund (PIF), L’IMAD, Qatar Investment Authority (QIA) and LionTree, at $12.00 per share. Bank of America, Citigroup and Apollo led the debt financing on the transaction.

Shares in Skydance Class B commenced trading on the New York Stock Exchange on 6 October under the new ticker symbol “SKYD.”

Chairman and CEO of Skydance David Ellison said of the acquisition: “Today is a historic day, not just for Skydance but for our entire industry. From the start, our ambition was to bring these two storied studios together and create a stronger competitor, with the talent, resources, and reach to tell great stories in every genre, on every platform, for audiences everywhere. Now that ambition is a reality. We’re grateful to everyone who made this possible – the employees, creative talent, and production teams of both companies, who worked tirelessly to get us here and inspire audiences around the world every day, as well as the advisors and partners who guided this transaction to completion. Our focus now turns to the future: building a company that empowers creatives, entertains audiences and rewards shareholders. We couldn’t be more excited to get to work.”

Skydance board director and RedBird Capital founder and managing partner Gerry Cardinale added: “This is a defining moment for the industry. By applying our owner-operator model to Paramount and WBD’s unmatched portfolio of iconic franchises, premium original programming, and live sports rights, we can protect that legacy while building for a media landscape that’s undergoing transformational change. David, our Co-CEO Ynon Kreiz, and the rest of our world-class Skydance team have the vision and track record to lead through this change. We’re proud to back them as we build a stronger Hollywood, expand opportunities for talent, and create long-term value for our shareholders.”

Following receipt of regulatory approvals under the merger agreement and customary closing conditions, the transaction has now closed.

Skydance took financial guidance from Centerview Partners and RedBird Advisors (acting as lead advisors), as well as from Bank of America Securities, Citi, M. Klein & Company and LionTree Advisors.

WBD sought financial advice from Allen & Company, J.P. Morgan and Evercore and legal counsel from Wachtell Lipton, Rosen & Katz and Debevoise & Plimpton.

Meanwhile, the Special Committee of the Board of Directors of Paramount took financial advice from Barclays Capital and legal guidance from Cleary, Gottlieb, Steen & Hamilton.