Paramount to combine HBO Max and Paramount+ to challenge Netflix

Published Tue, Mar 3, 2026 · 08:26 AM

[NEW YORK] Paramount Skydance said on Monday (Mar 2) that it will combine the Paramount+ and HBO Max streaming services into a single platform, following the company’s US$110 billion acquisition of Warner Bros Discovery.

The company expects the transaction, which was formally signed on Feb 27, to close in the third quarter. The deal came after months of effort on the part of Paramount chief executive officer David Ellison to acquire the famed Hollywood studio and related assets such as HBO, CNN and TNT. Paramount won a bidding war with Netflix, agreeing to pay US$31 a share in cash for the company.

Ellison said on an investor call on Monday, there are no plans to cut production and the deal is “pro-competition, pro-consumer and pro-creative community”. Paramount is targeting 15 theatrical films a year per studio for a total of at least 30 films annually.

“This is not about consolidation, it ’s about reinventing the business,” Ellison said.

Paramount shares were down 1.9 per cent to US$13.26 at 10.01 am in New York.

Paramount chief financial officer Dennis Cinelli said on the call that for 2026, they expect both companies to have US$69 billion in pro-forma revenue and US$18 billion in estimated earnings before interest, taxes, depreciation and amortisation. The combined companies will have net debt of US$79 billion.

Ellison said that the plan is to maintain HBO as a brand even after the company combines the Paramount+ and HBO Max streaming platforms.

“Across the two platforms, there are over 200 million D2C subscribers today in more than 100 countries and territories worldwide, positioning us to compete effectively with the leading streaming services in today’s marketplace,” he said.

He also emphasised how broad the merged company’s sports portfolio would be, noting that it would have rights to the National Football League, Ultimate Fighting Championship (UFC), March Madness, the PGA Tour and the Olympics in Europe. Ellison added that the US$7.7 billion deal Paramount struck with the UFC last summer gives the company the flexibility to air events on Warner Bros’ TNT network.

The company has no plans to spin off its cable networks after the merger, according to Ellison. If Warner Bros’ deal to sell its streaming and studios business to Netflix had gone through, Warner Bros. would have spun off its cable networks into a separate company called Discovery Global. Comcast recently completed a similar spinoff of some of its cable networks into a new company, Versant Media Group.

To win the deal, Paramount increased its offers, which began at US$19 a share back in September. Paramount paid Netflix a US$2.8 billion fee and agreed to pay US$7 billion to Warner Bros. if its deal is not approved by regulators.

Paramount chief operating officer Andy Gordon said on the call that a shareholder vote on the deal is expected in the spring. Paramount has also agreed to pay a “ticking fee” to Warner Bros. shareholders of 25 US cents a share for every quarter the transaction is not closed beyond Sep 30.

Paramount has given more details on its financing. That includes US$47 billion in equity, backstopped by the Ellison family and Red Bird Capital Partners. Ellison and his partners are buying new Paramount stock at US$16.02 a share. Existing Paramount investors will have the chance to participate in a rights offering raising up to US$3.25 billion.

The company also has plans to borrow US$54 billion from Bank of America, Citigroup and Apollo Global Management.

“This transaction marks a defining moment for both companies,” Ellison said. “By uniting our iconic studios, complementary streaming platforms with a global footprint, our cable and linear networks, and our world-class IP, we have the opportunity to help shape the future and build a next-generation media and entertainment company.” BLOOMBERG