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The Ellison media empire has recently overcome its largest legal challenge and is now poised to assume control of WBD. This development has shaken the bond markets, prompting an announcement of its new leadership team, which will operate under the name Skydance, after David Ellison’s studio.
Let’s delve into the recent legal updates.
Cases Closed: WBD Transitions to the Ellisons
Judge Araceli Martinez-Olguin ruled on Wednesday to approve the agreement stemming from an antitrust lawsuit that sought to prevent the merger of Paramount and Warner Bros.
This ruling clears the way for Paramount and Warner Bros. to finalize their deal, having already received government approval in the U.S. and abroad.
Martinez-Olguin deemed the settlement a “reasonable factual and legal resolution” of the dispute, confirming its procedural integrity and fairness.
The settlement stipulates that Paramount will produce between 30 to 32 films in the next five years, with a portion to be made in the U.S., alongside additional negotiations regarding separate channel cable packages and the establishment of an “independent editorial board” for CNN and CBS News.
Next, we turn to the bond market’s response.
Market Reaction: Billions in Paramount Debt Impacted
The Wrap reported on Paramount’s debt offering on September 28:
The debt offering submitted to the SEC included $32 billion in investment-grade debt along with $12.4 billion in high-yield bonds. Funds from this offering will be combined with equity, term loan financing, and available cash to facilitate the $110 billion acquisition of Warner Bros. Discovery.
By October 1, Bloomberg reported the fallout:
Just hours after Paramount Skydance Corp. issued $52 billion in debt to fund the largest Hollywood buyout in history, investors faced over $100 million in losses, leading to frantic calls from asset managers to the Wall Street banks that underwrote the debt.
The company’s junk bonds suffered particularly during initial trading; eight-year U.S. dollar notes were trading around 96 cents on the dollar just a day after being sold for 100 cents. Broadly, the market for loans and high-grade bonds weakened, reflected in a surge in the cost of credit default swaps for the company, which reached a 17-year high.
As trading resumed on Thursday morning, the bonds and loans experienced an immediate drop, though some recovered their losses later. This unusual activity stands out in contrast to typical Wall Street practices aimed at maintaining investor interest with modest gains. A significant debt sale followed by swift losses recalls a similar situation in June with SpaceX, which also encountered poor bond performance.
Paramount lost a considerable portion of orders for its longest-dated investment-grade bonds, leading money managers to reduce their risk exposure rapidly.
With selling pressures driving debt prices down in the early hours of trading, traders expressed frustration to underwriters Bank of America and Citigroup, noting that anticipated demand had sharply diminished.
As of October 5, here’s the latest on Paramount’s bonds:
Financial Times’ Alphaville has raised questions regarding the bond ratings and analyzed how Larry Ellison’s Oracle stakes underpin the debt:
We explored how investors are assessing the creditworthiness of this global AI leader. The new Paramount Skydance bonds were measured against other triple-B-rated corporate bonds in the ICE BofA corporate bond index.
It appears that two large issuers, both tied to the Ellison family, are facing notably high credit risk premiums compared to peers at the bottom of the investment-grade scale.
Chris Whittall of IFR recently pointed out that the insured cost of Paramount debt through credit default swaps has surged, indicating investor concerns despite family backing.
Who Is Supporting This Initiative?
Currently, Skydance’s total debt of approximately $80 billion is distributed among a diverse group of bond and loan investors. Apollo Global, who committed a $54 billion bridge loan in December, is fortunate they did not have to fund that loan, as they appear to have primarily served as an underwriter for new bond sales.
Insights into the ownership structure of the Ellison Media Empire reveal significant stakes held by the Ellison family. Notably, Larry Ellison’s interest in American TikTok (TikTok USDS) operates independently of Skydance.
The Ellison family possesses 77.5% of the voting Class A shares, while Gerry Cardinale’s RedBird Capital controls the remaining 22.5%. This significant investment stems from Larry Ellison’s family trust, which has committed up to $46.72 billion in fresh equity, backed by a personal $40 billion guarantee from December.
RedBird’s Fund IV contributed a modest $250 million to the Warner acquisition, adding to approximately $2 billion previously invested in the 2025 Skydance-Paramount merger.
Cardinale remains a board member, with former RedBird partner Andy Gordon now serving as president of Skydance.
Of the Ellison commitment, approximately $24 billion has been allocated to three sovereign wealth funds from the Gulf. Saudi Arabia’s PIF receives 15.1% of the company, with Abu Dhabi’s L’imad at 12.8% and the Qatar Investment Authority at 10.6%. This results in a total of 38.5% held in non-voting shares, each fund approved to increase their stake to 20%.
The Gulf funds surrendered board seats and governance rights to avoid national-security reviews, providing funding without influencing votes.
Notably, the Ellison trust and RedBird retain liability for the complete financial commitment even after selling portions of it. This connects the deal to Larry Ellison’s financial standing, which heavily relies on Oracle stock. In September, he proposed selling up to $7.5 billion in Oracle shares but reversed the decision within a day. Bloomberg reveals that investors now assess both Paramount and Oracle as a single credit risk associated with Larry Ellison.
Let’s now examine the new leadership structure at Skydance.
Leadership Update: Bari Weiss Departs, Ynon Kreiz Takes Charge
In a move welcomed by critics concerned about Bari Weiss’s influence at CBS News—and their dwindling viewership—it has been announced that she will not head CNN. Instead, Mark Thompson will remain as Chairman and Editor-in-Chief of CNN Worldwide, with both reporting directly to David Ellison and co-CEO Ynon Kreiz.
Rumors persist that Weiss faces difficulties in her current role according to the NY Post and Radar Online.
Now, let’s learn more about Ynon Kreiz.
Ynon Kreiz: The New Co-CEO in Charge of the Ellison Media Empire
Puck recently published a piece regarding Kreiz’s appointment titled “Ynon Sequitur“:
Immediately following a judge’s consent for the long-anticipated merger, David Ellison named Ynon Kreiz as co-C.E.O. of the combined Paramount–Warner Bros. Discovery. This role mirrors that of the previous Jeff Shell, but with genuine authority and direct accountability. Ynon, an experienced Israeli-American media executive, has spent the last eight years leading toy giant Mattel. His transition has triggered significant executive reshuffles.
Kreiz’s tenure at Mattel has been met with mixed reviews—while there have been some successful film and TV collaborations, such as Warner’s Barbie, ventures like Masters of the Universe failed to deliver. Despite his attempts at innovation, Mattel’s financial performance has been lackluster, with stock values declining significantly during his leadership.
David Ellison has carefully chosen seasoned C.E.O.s to support his vision, dismissing concerns about his youthful inexperience. Kreiz’s appointment as co-C.E.O. is a strategic choice aimed at clarifying the organizational hierarchy as he effectively integrates the various studios.
Notably, HBO C.E.O. Casey Bloys will oversee the combined entity’s streaming efforts, while Paramount’s streaming chief Cindy Holland has already departed.
In light of the Paramount-WBD merger and other recent Oracle developments, media scrutiny of Larry Ellison has intensified.
In the Spotlight: Vanity Fair’s Profile on Larry Ellison
Successful figures aware of rising criticism typically lean on their PR teams to engage outlets like Vanity Fair for favorable coverage, and Larry Ellison is no different. The article, titled “Inside Larry Ellison’s Wide Web of Power, Money, and Politics”, was released on October 1:
Tom Dotan from VF outlines Ellison’s connections to both Oracle and Skydance, as well as his political influence:
Ellison’s political aspirations began to unfold during Silicon Valley’s shift towards Trumpism, where he sought to cultivate relationships with key political figures, including President Trump. Internationally, he also funds Tony Blair’s nonprofit, which advocates for government adoption of innovative technologies like AI. Furthermore, he has consistently supported Benjamin Netanyahu, hosting the Israeli leader amid domestic corruption allegations.
I have previously suggested that Ellison’s alignment with Trump is overstated, especially concerning his reliance on Ari Emanuel to facilitate Skydance’s acquisition of Paramount. It’s important to note that Ellison did not participate in a notable recent White House meeting regarding AI safety.
The VF article delves further into Ellison’s significant increases in Oracle’s capital expenditure, resulting in heightened corporate debt:
In contrast to tech giants like Amazon and Google, Oracle turned to debt, having raised $43 billion through bond offerings recently. This aggressive borrowing increased total liabilities toward $130 billion, leading to extensive capital expenditures that negatively impacted free cash flow, which dipped below -$23.7 billion. The financial strain eroded bondholder confidence, causing Standard & Poor’s to downgrade the firm’s credit rating.
The subsequent market reaction revealed investor hesitation, halting various Oracle projects and leading to drastic stock declines.
Some analysts express skepticism over the sustainability of Oracle’s strategy and the potential for catastrophic failures if not managed accordingly.
The situation with Oracle raises pressing questions about the future: Is it a matter of taking calculated risks, or is it a leap into the unknown?
Final Thoughts
The ongoing developments surrounding the Ellison Media Empire and Paramount-WBD merger keep raising significant questions about market stability and corporate governance. As we follow these intricate dynamics in the financial and media sectors, the implications of these decisions will surely resonate in the long term.
Related Links
- Anthropic OpenAI, Meta, SpaceX Sign Trump ‘Self-Policing’ AI Accords Amidst Financial Follies While Oracle Is Left Out (Sep 2026)
- AI Credit and Credibility Collapsing or Will the AI Booster/Doomers Power Through? (Sep 2026)
- OpenAI Is Sinking Fast, Who Will It Pull Down With It? (Sep 2026)
- Stressed Oligarchs at Meta, OpenAI, and the Ellison Empire (Aug 2026)
- Ellison Empire Besieged On All Fronts (Jul 2026)
- Oracle’s Exploding Debt and Plummeting Stock Price Threaten Paramount Media Empire? (Jul 2026)
- Has the Ellison Infotainment Empire Peaked? (Apr 2026)
- Weak Links Oracle, OpenAI, UAE Are Hammered by Iran War (Apr 2026)
- OpenAI, Sora, Iran, the Ellison Empire, and Maybe a Recognition Event? (Mar 2026)
- Mask-Off Moment as Paramount at Nexus of AI, Gulf State Financing, and Private Equity (Mar 2026)
- Paramount Still Reaching for WBD as CBS Misplays Colbert-Talarico Interview (Feb 2026)
- Oracle Debt and TikTok Transition Troubles Vex the Ellison Media Empire (Jan 2026)
- Bari Weiss’ CBS Not an Auspicious Beginning to Total Info Control (Jan 2026)
- What Are They Thinking? Son, Altman, Ellison Edition (Dec 2025)
- Informational Force-Feeding Divides and Distracts (Dec 2025)
- Hasbara Ain’t Cheap, Musk, Ellison, Saudis, All Tapped (Nov 2025)
- Pyrrhic Victory Drives Dystopian High Tech Drive for Control (Oct 2025)
- Bari Weiss, CBS News, Meet the New Boss, Same as the Same Old (Oct 2025)
- Larry Ellison + Oracle + AI + Paramount + Trump = Total Info Control (Aug 2025)
- Trump Makes an Example Out of Paramount (Jul 2025)
