Shares of Warner Bros. Discovery (WBD) surged nearly 30 percent on Thursday afternoon, driven by reports indicating that Paramount, newly merged with Skydance Media, is considering a majority cash bid to acquire the media giant. According to The Wall Street Journal, this acquisition plan is supported by the Ellison family, led by billionaire Larry Ellison, and would encompass the entirety of WBD, including its cable television networks and movie studio.
WBD has expressed its intentions to restructure, separating into two distinct entities—one focused on global television assets and the other on streaming and studio operations. During an investor conference earlier in the week, WBD CEO David Zaslav announced that this restructuring is slated to commence in April. The streaming and studio branch is set to be renamed Warner Bros., while television properties, including CNN, TNT, and TBS, will be branded as Discovery Global.
The announcement had a notable impact on stock prices, with WBD shares closing at $16.17, up 29 percent. Meanwhile, Paramount’s stock also saw growth, finishing the day up by 9 percent. However, a spokesperson for Warner Bros. Discovery chose not to comment, while representatives from Paramount did not respond to inquiries.
Even though reports indicate no official offer had been presented to WBD as of Thursday, sources familiar with the situation suggested that the discussions are ongoing and could still evolve. The proposed acquisition comes shortly after Skydance, under the leadership of Larry Ellison’s son David, finalized its $8.4 billion acquisition of Paramount Global.
This merger has not been without controversy; it included a politically charged $16 million settlement to Donald Trump regarding a lawsuit with CBS News. Allegations surfaced suggesting that a “side deal” could have been arranged involving $20 million in pro-Trump advertisements on CBS, prompting an investigation by House Democrats into potential violations of anti-bribery laws. As part of securing the merger’s approval from the Federal Communications Commission (FCC), which is headed by a Trump appointee, Skydance also pledged to appoint an ombudsman to address complaints of bias at CBS.
In a further indication of shifting dynamics, the appointment of Kenneth Weinstein, a former Trump appointee, as the ombudsman reflects a broader agenda for conservative influence within the media landscape. David Ellison’s rumored interest in acquiring the anti-woke media startup, The Free Press, underscores his intention to elevate its founder, Bari Weiss, to a significant leadership position at CBS News.
While the proposed acquisition of Warner Bros. Discovery may not necessitate FCC clearance, given WBD’s lack of broadcast licenses, it is expected to attract considerable scrutiny from antitrust regulators. The potential merger would unite two historic film studios under one ownership, in addition to combining their extensive streaming services. Paramount+ currently boasts approximately 77.7 million subscribers, while Warner’s HBO Max and other streaming platforms have nearly 126 million subscribers. Despite standard operations, the political climate surrounding the current administration adds layers of complexity, particularly considering the contentious nature of CNN—owned by Warner Bros.—the subject of frequent attacks from Trump.
