Paramount launches $77.7B Warner Bros. Discovery acquisition with $47B equity PIPE, $49B debt

On February 27, 2026, Paramount Skydance Corporation (“Paramount,” or the “Company,”) and Prince Sub Inc., a Delaware corporation and wholly owned subsidiary of Paramount (“Merger Sub”) entered into an Agreement and Plan of Merger (as it may be amended, supplemented or otherwise modified in accordance with the terms, the “WBD Merger Agreement”) with Warner Bros. Discovery, Inc. a Delaware corporation (“WBD”), pursuant to which and subject to the terms and conditions therein, Merger Sub will merge with and into WBD, with WBD surviving as a wholly owned subsidiary of Paramount (the “Acquisition”).

At the effective time of the Acquisition (“the Effective Time”), each share of WBD Common Stock issued and outstanding immediately prior to the Effective Time (other than shares of WBD Common Stock to be cancelled for no consideration in accordance with the WBD Merger Agreement or as to which appraisal rights have been properly exercised) will be converted into the right to receive an amount in cash equal to $31.00, without interest, plus, if applicable, the Ticking Consideration (collectively, the “Merger Consideration”). The “Ticking Consideration” will be an amount in cash equal to $0.00277778 multiplied by the number of calendar days elapsed after September 30, 2026 to and including the closing date of the Acquisition (which for the avoidance of doubt, will not exceed $0.25 per 90 calendar day period). Total cash consideration payable to WBD common stockholders is estimated at $77.7 billion, calculated based on WBD Common Stock outstanding as of April 23, 2026, excluding any applicable Ticking Consideration as the Company assumes for the purposes of these pro forma financial statements that the transaction will close prior to September 30, 2026, and any cash payable with respect to equity awards as described under “—Treatment of Equity Awards” below.

Paramount Skydance Corporation (NASDAQ: PSKY) (“Paramount”) today announced that it has commenced (i) offers to purchase (the “Tender Offers” and each, a “Tender Offer”) for cash, upon the terms and subject to the conditions set forth in the related offer to purchase (the “Offer to Purchase”), any and all of the identified notes in each series of the Existing Tender Offer Notes (defined by reference to the table set forth below) issued by Discovery Global Holdings, Inc. (formerly WarnerMedia Holdings, Inc.) (the “DGH Issuer”) and Discovery Communications, LLC (the “DCL Issuer” and together with the DGH Issuer, each a “WBD Issuer” and collectively the “WBD Issuers”), as applicable, and (ii) offers to exchange (the “Exchange Offers” and each, an “Exchange Offer”), upon the terms and subject to the conditions set forth in the related exchange offer memorandum (the “Offering Memorandum”), any and all of the identified notes in each series of the Existing Exchange Offer Notes (defined by reference to the table set forth below) (together with the Existing Tender Offer Notes, the “Offer Notes”) issued by the applicable WBD Issuer for newly issued New PSKY Notes (defined by reference to the table set forth below) to be issued by Paramount with the same currency, maturity date, interest payment dates and interest rates (with certain exceptions as indicated on the table below) as the Existing Exchange Offer Notes validly tendered and accepted in the Exchange Offers.

The Tender Offers and Exchange Offers (together, the “Offers”) are being conducted in connection with the proposed acquisition (the “Acquisition”) by Paramount of Warner Bros. Discovery, Inc. (“WBD”), the parent entity of the WBD Issuers. The Offers are being made solely by Paramount and are not being made by WBD or the WBD Issuers.

Concurrently with the Offers, the WBD Issuers have commenced solicitations (collectively, the “Consent Solicitations”), upon the terms and subject to the conditions set forth in the related consent solicitation statement, of consents from holders of certain series of notes issued by the WBD Issuers (the “WBD Notes”) to certain proposed amendments (the “Proposed Amendments”) to the indentures governing the WBD Notes (the “Existing WBD Indentures”) that would (i) extend the deadline by which the WBD Issuers are obligated to commence an offer for junior lien secured notes (“Junior Lien Exchange Notes”) of the WBD Issuers in exchange for the WBD Notes (a “Required Exchange Transaction”) from December 30, 2026 to the End Date (as defined in the Agreement and Plan of Merger governing the Acquisition (the “Merger Agreement”)), which is March 4, 2027 (as such date may be extended by the parties to the Merger Agreement); provided that if the Merger Agreement is validly terminated on or prior to the End Date, such deadline shall mean the date that is the later of (x) December 30, 2026 and (y) 90 calendar days following the date on which the Merger Agreement is validly terminated

Holders of Existing Tender Offer Notes (“Tender Noteholders”) with a Temporary Identifier who validly tender (and do not validly withdraw) their Existing Tender Offer Notes in the applicable Tender Offer at or prior to 5:00 p.m., New York City time, on June 17, 2026 (the “Tender Expiration Date”), and who beneficially own such tendered Existing Tender Offer Notes on the Tender Expiration Date, will be eligible to receive, for each $1,000 in aggregate principal amount of Existing Tender Offer Notes validly tendered and accepted for purchase pursuant to the Tender Offers, consideration (the “Tender Consideration”) to be determined in the manner described in the Offer to Purchase by reference to the applicable fixed spread (the “Fixed Spread”) specified in the table above for each series of Existing Tender Offer Notes over the yield (the “Reference Yield”) based on the bid-side price of the applicable U.S. Treasury Security specified in the table above (the “Reference Treasury Security”), as calculated at 10:00 a.m., New York City time, on the date on which the Expiration Date occurs (such time and date, the “Price Determination Date”).

The New PSKY Notes will be guaranteed by each of Paramount’s domestic subsidiaries that is an obligor under Paramount’s existing credit agreement providing for term A loan facilities (the “New PSKY Notes Guarantors”), which, following the Acquisition, will include WBD and certain of its subsidiaries, and will be secured on a second lien basis by substantially all of the assets of Paramount and each of the New PSKY Notes Guarantors, subject to certain customary and other exceptions described in the Offering Memorandum.

Paramount has, by reference to this Current Report, incorporated by reference into the Offering Memorandum certain unaudited pro forma condensed combined financial statements and other information of Paramount giving effect to the Acquisition and the other transactions in connection therewith, as well as the Skydance Transactions and the NAI Transaction (each as defined in Paramount’s Form 10-Q for the quarterly period ended March 31, 2026, filed with the SEC on May 4, 2026), that is attached hereto as Exhibit 99.2.