Who Will Buy Warner Bros Discovery? Investors Crave Blockbuster Deal As Hollywood’s Biggest Sharks Circle Media Giant

• Paramount Skydance, Netflix, and Comcast are reportedly eyeing a full or partial buyout of Warner Bros. Discovery.
• After Paramount made an unsolicited $60 billion bid months ago, WBD launched a formal process to court potential buyers; bidding is reportedly underway.
• The Warner Bros. acquisition would give the buyer significant studio and production assets, rights to iconic franchises, and a major streaming platform.

A financial thriller straight out of a Hollywood script may be unfolding in real life.

A bidding process for Warner Bros. Discovery, which houses the iconic film studio behind “Batman,” “Harry Potter,” and “The Matrix” franchises, as well as a major streaming service, is underway, with the who’s who in the media industry eyeing a full or partial buyout.

The newly formed Paramount Skydance, streaming giant Netflix, and NBCUniversal owner Comcast are reportedly the top contenders in the open bidding war Warner Bros. kicked off last month.

The mega deal, which could be in the ballpark of $60 billion, would take place against the backdrop of an evolving media landscape with declining TV viewership, consumption shifting to streaming services and YouTube, and creators increasingly turning to artificial intelligence.

In a way, the company that buys Warner Bros. would essentially have more muscle in production and distribution, and in dictating content trends. 

The Backdrop

Warner Bros. Discovery has largely struggled after the Warner Bros. and Discovery Inc. merger in 2022. So, when the company received unsolicited interest from Paramount Skydance (which itself was formed after a mega-merger earlier this year), the Warner Bros. board thought, Why not!

Note: The 2025 figure is an estimated projection; the Warner Bros. and Discovery Inc. merger was completed in April 2022.
 

Although Warner Bros. reportedly rejected Paramount's $60 billion bid and others at the time, it launched in October and announced a formal bidding process and alternatives review for the company. 

Media conglomerates are typically an amalgamation of several TV, studio, streaming, digital, and merchandise assets, but what makes the Warner Bros. deal more complicated is its pre-existing spin-off plan.

In June, the company said it would split into two next year: one company to house its studios and streaming businesses, and the other comprising its cable networks. The plan, Warner Bros. said at the time, is in response to changing viewership patterns, with the company wanting to hive off its legacy cable businesses from growth assets such as its flagship streaming service, HBO Max, and the Warner Bros. Pictures studio.

Warner Bros. has said that the plan is still in place.

So, Who’s Buying WBD?

The bids are not public, although the benchmark to beat is $60 billion.

Warner Bros. is said to want $30 a share, and the company’s chair emeritus, John Malone, has said that number is “possible.” WBD closed at $23.87 on Monday, with Warner Bros. sitting pretty at a market cap of $59.15 billion.

To be sure, the shares have been on a tear this year, for various reasons, including the buyout interest itself. The stock has gained a whopping 124% year-to-date, and that could create all sorts of issues for Warner Bros. shareholders getting a fair value and for buyer(s) breaking their bank.

For now, Paramount Skydance is reportedly the only bidder for the entire company. Bloomberg reported, citing its sources, that its offer is largely backed by the family of Oracle Corp. co-founder Larry Ellison, and includes debt financing from Apollo Global’s Middle East funds.

Larry Ellison is the father of David Ellison, who became the chairman and CEO after the merger of Paramount and Skydance. He recently laid out a bold growth plan for the company. 

Comcast and Netflix, on the other hand, are interested only in the Warner Bros. studios (which also include New Line Cinema, and Warner Bros.' animation and TV studios), and the HBO Max streaming service.

From a purely cash muscle point of view, Comcast leads the odds, given its highly profitable core telecom business. From the perspective of where combined strengths would be greatest, the deal would make the most sense for Netflix (see table).

Note: The table is not exhaustive.
 

The Warner Bros. auction could wrap up in the coming days or weeks. With bids being binding, the board could sign off on a deal quickly if its goals are met.

This Christmas may look more like a Fourth of July blockbuster, at least for deal-watchers who already have their popcorn buckets filled.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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