Skydance Media and Paramount Global agreed to merge, the companies announced late on Sunday, scripting a new chapter for one of Hollywood’s oldest studios.

The companies agreed to a two-step process in which Skydance and its deal partners will acquire National Amusements, which holds the Redstone family’s controlling stake in Paramount, for $2.4 billion in cash.

Skydance will subsequently merge with Paramount, offering $4.5 billion in cash or stock to shareholders and providing an additional $1.5 billion for Paramount’s balance sheet, a Reuters report stated.

David Ellison, the 41-year-old tech scion who founded Skydance, will become chairman and chief executive of the new Paramount. Jeff Shell, former chief executive of NBCUniversal, will be its new president.

The goal of the deal is to position the “new Paramount” as a “tech hybrid, to be able to transition to meet the demands and needs of the evolving marketplace,” Ellison told financial analysts yesterday.

The deal represents the end of an era for Shari Redstone, whose father and late patriarch, Sumner Redstone, transformed the family’s chain of drive-in movie theaters into a media empire that included Paramount Pictures, the CBS broadcast network and cable television networks Comedy Central, Nickelodeon and MTV.

“Given the changes in the industry, we want to fortify Paramount for the future, while ensuring that content remains king,” Redstone, chair of Paramount and National Amusements, said in a statement, citing a phrase her father coined.

Paramount’s 2025 revenue will reach $32.6 billion on a pro forma basis and 2027 revenue is expected to rise by 2 percent to $33.5 billion, according to the slides.

Ellison, son of Oracle co-founder Larry Ellison, stands to inherit a media company that has a mountain of challenges, as it navigates an entertainment business upended by the streaming video revolution.

Paramount has shed nearly $17 billion in value since late 2019, as its traditional television business has eroded faster than its Paramount+ streaming service could turn a profit.

There has been tension in the executive suites. Its chief executive, Bob Bakish, was ousted in April after clashing with Redstone over the Skydance deal. He was replaced by a trio of executives who occupy the “office of the C.E.O”, a group that has proposed making $500 million in cuts, selling off certain assets, and exploring a possible joint venture partner for Paramount+.

Ellison pledged to bring “best-in-class” technology and modern infrastructure to Paramount+ and the free streaming service, Pluto TV, even as it enhanced Paramount’s traditional television networks.

The Paramount-Skydance deal came together after months of talks that appeared to have derailed when Redstone abruptly called off negotiations on June 11.

Skydance sweetened the Redstone family’s payout for the sale of National Amusements to $1.75 billion, said one of the sources familiar with the deal terms. It also enhanced legal protections from possible shareholder lawsuits, clearing the way for a new agreement, the source said, according to the Reuters report.

Under the terms of the agreement, Ellison’s Skydance will merge with Paramount in an all-stock transaction that values Skydance at $4.75 billion, creating a company with an enterprise value of $28 billion.

Meanwhile, in India, Paramount had scaled down its holding last year in Viacom18, a joint venture amongst the Reliance Industries, Paramount and Bodhi Tree, an investment firm led by James Mordoch and former Disney Asia head Uday Shankar.