Paramount Skydance (PSKY) investor relations material

Deal rationale and strategic fit

• The merger unites two leading media and entertainment companies to create a next-generation global competitor with over 200 years of combined storytelling experience, combining iconic studios, streaming platforms, and global networks.

• The combined entity will own a vast portfolio of franchises and IP, including Harry Potter, Top Gun, Game of Thrones, and more, enhancing its competitive position in streaming, film, and sports.

• Establishes a premier direct-to-consumer streaming platform with over 200 million global subscribers, enhancing competition and growth.

• Focuses on expanding consumer choice, empowering creative talent, and delivering high-quality content across platforms, with a commitment to maintaining and investing in creative leadership.

• Broad international presence in over 200 countries, supporting local and global storytelling and distribution of marquee sports and news content.

Financial terms and conditions

• Paramount will acquire 100% of Warner Bros. Discovery for $31 per share in cash, valuing WBD at $81 billion in equity and $110 billion in enterprise value.

• The transaction is funded by $47 billion in new equity investment from the Ellison family and RedBird Capital Partners at $16.02 per share, with existing shareholders able to participate via a rights offering.

• $54 billion in debt commitments have been secured, including $39 billion in new debt and $15 billion to refinance existing facilities, supported by a fully committed bridge loan.

• The deal includes a $2.8 billion termination fee already paid to Netflix and a ticking fee of $0.25 per share per quarter for WBD shareholders if closing is delayed past September 30, 2026.

• No financing conditions are attached to the transaction.

Synergies and expected cost savings

• The merger targets over $6 billion in synergies within three years, primarily from technology integration, procurement efficiencies, real estate optimization, marketing, and IT systems.

• No reduction in production capacity is expected; efficiencies will come from operational improvements and technology integration.

• Synergies are expected to support investment, debt reduction, and improved user experience.

• Clear path to investment grade credit metrics within three years of closing, with net debt-to-EBITDA of 4.3x at closing.