Skydance tells staff job cuts will follow $111 billion WBD deal

Skydance chairman and chief executive David Ellison and co-chief executive Ynon Kreiz told employees on October 6, shortly after the company completed its acquisition of Warner Bros Discovery, that combining the two businesses would require "difficult decisions that affect our workforce," according to StoryBoard 18. The memo did not say how many jobs could be cut, and the executives said the process would be handled thoughtfully and respectfully.

The transaction is valued at about $111 billion including assumed WBD debt. WBD shareholders received roughly $31 a share in cash, and the stock stopped trading on Nasdaq. The combined company brings together Paramount Pictures and Warner Bros., Paramount+ and HBO Max, CBS, CNN and HBO, along with cable networks, sports properties and franchises including DC, Harry Potter, Star Trek and Game of Thrones. Skydance says annual revenue will be close to $70 billion.

Management is targeting at least $6 billion in run-rate cost savings over three years. Skydance board member Gerry Cardinale, who structured the deal, said most of the savings would come from non-labor items such as merging technology systems across the direct-to-consumer operations, and Ellison said after the closing that reductions in headcount would not be the main source.

A report commissioned by Los Angeles County in August estimated about 4,500 direct film and television jobs in the county could be lost over the three-year integration period, and 10,360 job-years including indirect employment. The report said the figures were not a layoff forecast.

This story was first reported by StoryBoard 18.