Warner Bros. Discovery Rejects Paramount’s $20/Share Deal Proposal
Warner Bros. Discovery (WBD) has turned down a takeover proposal from Paramount Skydance, led by David Ellison. The offer, reported to be around $20 per share, was deemed “too low,” according to a Bloomberg News report citing anonymous sources.
Details of the Proposed Deal
The rejection comes as WBD shares closed at $17.10 on the preceding Friday, reflecting a 36% increase in value since September 11, when news of Ellison’s interest first surfaced. Despite this rise, industry analysis considers the proposal insufficient.
Market Position of Warner Bros. Discovery
- Market capitalization: $42.3 billion
- Total debt (as of June 30): $35.6 billion
Bloomberg’s report did not disclose whether the bid included an assumption of WBD’s total debt. Paramount Skydance has previously engaged with Apollo Global Management, which had expressed interest in acquiring Paramount Global, regarding a joint bid for WBD.
Key Players and Insights
Larry Ellison, founder of Oracle and father of David Ellison, financed much of Paramount Skydance’s $8 billion acquisition of Paramount Global. During a recent conference, David Ellison suggested the need for Paramount to diversify its content sources to sustain growth in an increasingly streaming-focused market.
- Ellison emphasized the importance of content in driving audience engagement.
- He hinted at various merger and acquisition opportunities in the industry.
While details about specific targets for acquisition were not shared, the bid for WBD aims to acquire the company in its entirety, as noted by the Wall Street Journal.
Future Developments for Warner Bros. Discovery
Warner Bros. Discovery is set to restructure into two distinct entities in the upcoming spring. This separation will result in one company focusing on Warner Bros. studios and streaming services and the other on Discovery Global, which includes television networks and Discovery+.
The landscape in the media and streaming market continues to evolve, making strategic partnerships and acquisitions crucial for growth.
