Warner Bros. Discovery is considering “strategic alternatives” in light of “unilateral benefits” it has received from multiple parties for both the company as a whole and the independent Warner Bros. streaming and studio entities, the media conglomerate announced Tuesday.
WBD did not disclose which companies made the M&A proposal. However, the announcement comes after Paramount Skydance, led by Chairman and CEO David Ellison, was in the process of making a blockbuster deal to acquire Warner Bros. Discovery in its entirety. In recent weeks, WBD reportedly rejected Paramount Skydance’s offer of $20 per share as too low.
Following Warner Bros.’ Discovery announcement, the company’s stock soared more than 8% in early trading to nearly $20 a share.
Warner Bros. Discovery “continues to move forward with the previously announced separation of Warner Bros. and Discovery Global,” which is currently targeted to be completed by April 2026. At the same time, the board announced that it had begun considering strategic alternatives “to maximize shareholder value.” Through this process, the Warner Bros. Discovery board will evaluate a range of strategic options, including the sale of the entire company or separate transactions for Warner Bros. and/or the Discovery Global business, the company said.
As part of the review, the company said it would also consider alternative separation structures that would allow for a merger of Warner Bros. with a third-party acquirer, alongside a spin-off to Discovery Global shareholders.
“By advancing our strategic initiatives, returning our studio to industry leadership and expanding HBO Max globally, we continue to make important strides to succeed in today’s evolving media landscape,” David Zaslav, President and CEO of Warner Bros. Discovery, said in a statement.
Mr. Zaslav continued: “It is not surprising that the material values of our portfolio are increasingly being valued by others in the market. Following interest from multiple parties, we have begun a comprehensive review of strategic alternatives to identify the best path to maximizing the value of our assets.”
Samuel A. Di Piazza Jr., Chairman of the Warner Bros. Discovery Board of Directors, said in a statement: “Our decision to initiate this review demonstrates the Board’s commitment to consider all opportunities to determine the best value for shareholders. “While we continue to believe that the planned separation to create two separate leading media companies creates compelling value, we have determined that it is in the best interests of our shareholders to take these steps to expand our reach.”
WBD said no deadline or “final timeline” has been set for completing the strategic alternatives review process. The company said it aims to close in April 2026, and other than the separation transaction already in progress, “there can be no assurance that the company will pursue a transaction or other outcome through this process.”
Warner Bros. Discovery said in a statement that it does not intend to make any further announcements regarding its review of strategic alternatives “unless the Board of Directors approves a specific transaction or otherwise determines that further disclosure is appropriate or necessary.”
Allen & Company, JP Morgan and Evercore are serving as financial advisors to Warner Bros. Discovery, and Wachtell Lipton, Rosen & Katz, Debevoise & Plimpton LLP is serving as legal advisor.
