The newly-merged entity, Paramount Skydance (PSKY), is preparing an all-cash bid for Warner Bros. Discovery (WBD). The offer could be worth more than $50 billion, according to people familiar with the matter. Although the bid is not yet official, reports say it may come as soon as next week.
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This news comes as Warner Bros. Discovery recently said it plans to separate its studio and streaming assets from its global television networks. The split is expected by April next year, with Warner Bros. holding HBO, the film studio, and streaming, while Discovery Global will own TNT, CNN, and other cable brands. Because the split is not yet complete, any buyer would need to acquire the entire company.
Market Reaction and Deal Shape
In the wake of the news, shares of Warner Bros. Discovery rose more than 28% on Thursday to $16.15, which marked the best day in the stock’s history. On Friday, the stock continued its climb with another 16%, closing at $18.87 after new reports stated that Chief Executive David Zaslav had also met with bankers to explore talks with other potential buyers, including offers from Amazon (AMZN) and Apple (AAPL). And Netflix (NFLX). The general notion is that Zaslav is looking to set up a bidding war.
The possible deal comes just weeks after Skydance completed its $8.4 billion merger with Paramount Global. David Ellison and RedBird Capital backed that transaction, and also supported by Ellison’s father Larry Ellison, the co-founder of Oracle (ORCL). The Ellison family wealth is expected to help finance the Warner Bros. Discovery bid.
Industry Impact and Next Steps
A merger between Paramount Skydance and Warner Bros. Discovery would join two of the largest film studios and bring together streaming platforms Max and Paramount+. It would also combine extensive sports rights, including deals across the NFL, MLB, college football, and basketball. Key franchises, such as Harry Potter, DC Comics, The Lord of the Rings, Star Trek, and Top Gun, would also exist under one roof.
The media sector has been moving toward consolidation as companies look to build scale against the likes of Netflix , Walt Disney (DIS), and Comcast (CMCSA). Analysts note that the Trump administration has shown a lighter approach to antitrust enforcement, which may make the environment more open for large deals. Still, regulators would likely review the impact on prices, content choice, and bargaining power for creators.
For now, investors are watching closely. Warner Bros. Discovery shares have surged on the news, and Zaslav is said to be seeking a competitive auction that could push valuations higher. His stated goal is to reach $40 per share if more bidders emerge.
Is WBD Stock a Buy?
On the Street, Warner Bros. Discovery boasts a Moderate Buy consensus rating. The average WBD stock price target stands at $14.65, implying a 22.36% downside from the current price.
