Warner Bros. Discovery has rejected an initial takeover offer of around $20 per share from David Ellison’s Paramount Skydance, calling the bid too low, as first reported by Bloomberg. The move pits two of Hollywood's biggest players against each other in a high-stakes battle for consolidation.
Double or nothing: Ellison isn't expected to walk away from the deal. Instead, he is reportedly exploring a more aggressive path, which could mean a higher offer or even a hostile bid aimed directly at shareholders, potentially with financial backing from a partner like Apollo Global Management.
Zaslav's gambit: The rejection is a direct counter to Ellison's consolidation play, as WBD chief David Zaslav is advancing his own plan to split the company. His strategy involves spinning off the lucrative studio and streaming assets from the legacy cable networks, betting that a standalone "crown jewel" business would spark a frenzy of interest and drive up the final price.
The Street speaks: While Ellison champions the need for more scale, Wall Street seems to favor Zaslav’s split-and-sell strategy for now. In a note, Bank of America analyst Jessica Reif-Ehrlich wrote that WBD's "streaming and studio assets would generate a bidding war amongst potential buyers," as reported by outlets like Sports Business Journal.
The conflict sets up a tense showdown. Ellison wants to buy the whole media empire now, while Zaslav is betting he can get a much better price by selling off the best parts later.
Also on our radar: The potential merger carries massive implications beyond streaming, particularly in the sports world, where it could unite CBS Sports and TNT Sports under one roof. For a visual breakdown of how the combined assets would stack up against competitors, The Wall Street Journal has a detailed chart.
