Skydance Shares Plunge 25% After 471 Million Warrants Issued
Skydance stock fell to $6.78 per share on Wednesday after the company distributed roughly 471 million warrants to Paramount Skydance investors.
Skydance Corp. shares fell as much as 25% in trading on Wednesday after the company issued about 471 million warrants to holders of Paramount Skydance's PSKY Class B shares, according to Variety. As of 11 a.m. ET, the stock was down 25.4% to $6.78 per share. Skydance's market capitalization is estimated at about $34 billion.
The warrants give holders the right to purchase stock in the new company. Each warrant initially allows holders to buy one Skydance share for $12. If all warrants were exercised, the company would raise about $5.65 billion.
The New York Stock Exchange also announced it will adjust the official closing price of Skydance's Class B common stock downward by $0.19368 per share.
Background
Skydance began trading on the New York Stock Exchange under the symbol 'SKYD' on Oct. 6. The warrants issued to PSKY shareholders are intended to give them the opportunity to purchase shares on similar terms to those offered in the $47 billion equity syndicate backing the Warner Bros. Discovery deal. Last week, after the Paramount-Warner Bros. Discovery deal closed, chairman and CEO David Ellison and co-CEO Ynon Kreiz announced their senior executive leadership team.