Mark Malek, Chief Investment Officer of Siebert Financial, discusses the troubled market under the theme “Making Money.”
Skydance Corp. shares fell on Wednesday after the new media giant distributed nearly 471 million stock warrants to shareholders.
Skydance shares fell 26% in Wednesday trading, trading at $6.68 per share as of 11:35 a.m. ET. The stock then pared some of those losses, closing down 22.2% at $7.06 per share.
The company distributed approximately 470.7 million warrants on October 13 following its acquisition of Warner Bros. Discovery, according to a filing by the Securities and Exchange Commission (SEC).
Warrants give investors the right to buy shares at a fixed price before they expire.
PARAMOUNT Reaches Settlement with States Sue to Block Warner Bros. Discovery Takeover
Skydance Corp. shares fell on Wednesday after the new media giant distributed nearly 471 million stock warrants to shareholders. (Photo by Richard B. Levine)
Eligible shareholders received one warrant for each share of Skydance Class B common stock they held as of the October 5 record date. Each warrant entitles its holder to purchase one Skydance Class B share for $12.
If all the warrants are exercised, Skydance could raise approximately $5.7 billion, according to the company.
The warrants are scheduled to expire in October 2036, although they could expire earlier under certain conditions.
The distribution of warrants followed Skydance’s finalization of its purchase of Warner Bros. Discovery for $110 billion. The deal brought together brands including CBS, CNN, Paramount+ and HBO Max under one company, according to Reuters.
WARNER BROS DISCOVERY SHAREHOLDERS APPROVE PARAMOUNT SKYDANCE DEAL
The distribution of warrants followed Skydance’s finalization of its purchase of Warner Bros. Discovery for $110 billion. (Ringo Chiu/Reuters)
The combined company began trading on the New York Stock Exchange under the symbol “SKYD” following the transaction.
Wells Fargo analysts said the distribution of the warrants marked the “final step” in closing the Warner Bros. transaction. Discovery, according to Variety.
CEO David Ellison said the merger would help Skydance better compete with streaming and tech giants including Netflix and Amazon, Reuters reported.
Skydance plans to combine HBO Max and Paramount+ into a single streaming service while realizing about $6 billion in projected savings.
CALIFORNIA Cracks Down on STREAMING ADVERTISING UNDER NEW STATE LAW
CEO David Ellison said the merger would help Skydance better compete with streaming and tech giants including Netflix and Amazon. (Jeenah Moon/Reuters)
GET FOX BUSINESS ON THE GO BY CLICKING HERE
The combined company is expected to have debt of around $80 billion, according to Reuters.
FOX Business has contacted Skydance for comment.
Reuters contributed to this report.
Gn bussni
