In recent weeks, Warner Bros. Discovery rejected a takeover offer of “approximately” $20 a share from David Ellison’s Paramount Skydance as “too low,” Bloomberg News reported Saturday, citing anonymous sources.
On Friday, WBD stock closed at $17.10 per share, up more than 36% since news broke on Sept. 11 that Ellison was interested in making a bid for a rival company, just weeks after Skydance closed its deal to buy Paramount Global. Warner Bros. Discovery, the parent company of HBO/HBO Max, Warner Bros. Entertainment, CNN, TNT, TBS, etc., has a market capitalization of $42.3 billion. The Bloomberg article did not say whether Paramount’s bid included assuming WBD’s total debt, which was $35.6 billion as of June 30.
Bloomberg reports that Paramount Skydance is in talks with Apollo Global Management, the asset management company that previously bid for Paramount Global, about joining the Warner Bros. Discovery bid. David’s father, billionaire Oracle founder Larry Ellison, provided most of the financing for the $8 billion deal between Skydance and Paramount Global.
Representatives for Paramount, WBD and Apollo did not respond to requests for comment Sunday.
Speaking at the Bloomberg ScreenTime conference in Los Angeles last week, Ellison did not confirm Paramount Skydance’s bid for WBD. But he went on to explain why he believes Paramount needs to further strengthen its content production engine to achieve sustainable growth in today’s streaming-centric world, citing comments from WBD Secretary David Zaslav that the industry needs more consolidation.
“I think there are a number of (M&A) options that could actually become viable in the near future,” Ellison said at a press conference. “The reality is that to create more engagement, you need more content. So really, no matter how you look at it, we want to be in this business and produce ‘more movies, more TV series’ to get more scale and engagement.” Mr. Ellison declined to name potential takeover targets.
The Wall Street Journal first reported that Paramount Skydance’s bid for Warner Bros. Discovery would be for the entirety of WBD. The M&A move comes ahead of WBD’s plans to split into two separate companies next spring: Warner Bros., which includes studios and streaming, and Discovery Global, which includes television networks and Discovery+.
