Elon Musk has reportedly invested $1 billion in Skydance, the media conglomerate that completed the merger between Paramount Skydance and Warner Bros. Discovery earlier this month.
The news comes after previous reporting indicating that Skydance CEO and Chairman David Ellison was asking Musk for a possible equity investment in his entertainment empire.
The world’s richest man appears to have made such an investment, reported by Semafor and later confirmed by CNBC based on its own sources.
Musk has not commented on the investment himself, but he did congratulate Ellison on completing the merger days before it was expected to close.
Skydance’s chief executive is the son of Oracle co-founder Larry Ellison, who is an ally of President Donald Trump. The Ellison family’s connection to the president triggered critics’ concerns about Skydance’s control over CNN and CBS News.
Now that Musk is financially involved with Skydance, those concerns will likely be exacerbated even more.
There is speculation that Musk’s investment in Skydance is just the beginning, especially after media mogul John Malone predicted Musk would commit up to $10 billion to help pay down the media giant’s massive debt and possibly give SpaceX a stake in the entertainment business.
“I predict — big prediction — that you’ll see a global output deal for Skydance with SpaceX, and an investment by SpaceX into Skydance, to de-lever Skydance and take a little bit of the burden off David Ellison’s shoulders, because he’s taking on a pretty big pile of debt,” Malone said at an event earlier this week.
The newly combined company has nearly $80 billion in debt after closing the approximately $110 billion merger on Oct. 6. David Ellison and Skydance co-CEO Ynon Kreiz have their work cut out for them in terms of meeting their $6 billion cost-savings goal to reduce the company’s burgeoning debt.
Larry Ellison is personally invested in Skydance, having put up more than $40 billion in equity financing and financial obligations to push the Paramount-Warner Bros. deal through to completion.
Because Larry Ellison is financially involved in Skydance, Malone makes the case that the Oracle executive will leverage his preexisting relationship with Musk to bring him on board.
“These guys are very intertwined,” Malone said. “Who helped Elon finance Twitter when he bought it [for $44 billion in 2022]? Larry Ellison. OK, how did Larry Ellison come up with some of the money to put into the creation of Skydance? Tesla stock. And I would not doubt for a minute that before very long you’re going to see an announcement.”
WHAT’S NEXT FOR SKYDANCE AFTER PARAMOUNT-WARNER BROS. MERGER?
Indeed, reports of Musk’s investment came shortly after Malone made his prediction. There has been no announcement from Skydance about Musk’s involvement yet.
It remains to be seen if SpaceX, which owns and operates Starlink, will partner with Skydance in the near future.