Warner Bros. Discovery CEO David Zaslav Wants The Paramount Merger Talk To Become A Bidding War
The newly merged Paramount Skydance, an $8.4 billion deal led by one of the richest families in the world, is exploring the possibility of acquiring Warner Bros. Discovery, too. There was speculation, according to Deadline, that Paramount was only after the studio once it split this spring, but in reality, they want the whole thing.
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“[Larry Ellison, chairman and co-founder of Oracle, and father of Skydance Media’s David Ellison] has been looking at Warner Bros for a while,” a source with an ear to Paramount brass said. “Nothing new there, he’s just taking a closer look, assessing the pros and cons.” One pro in the interim, says The Wall Street Journal, was the soaring WBD stocks.
Deadline also reported that a potential deal could circumvent the wrath of the Federal Communications Commission and the Department of Justice. The Trump administration is more lenient with mergers, and the President is on good terms with both the Ellison family and David Zaslav. However, if the Skydance people believe they have a slam-dunk offer, they should think again.
The WBD CEO has other ideas that include an old-fashioned bidding war. “According to a person with direct knowledge of the matter, he met earlier this week with his bankers at Goldman Sachs to gauge bidding interest from other media and tech outfits – including Amazon, Apple and Netflix,” reports The New York Post.
The Post adds that the goal “is to propel the stock price possibly to $40 a share. It closed Thursday just above $16 with a market value of $40 billion. If Zaslav can’t get the price he’s seeking, a source said he plans to use the appreciation of his stock price to buy more content.”
“[David] Ellison better come up with a really good offer and it better be cash,” said a person involved in Zaslav’s dealings that spoke to The NYP. “It’s (Zaslav’s) feeling that Ellison is trying to get ahead of the bidding war that is coming.”
According to The Post, media mogul Jay Penske, owner of Variety, Hollywood Reporter, and Rolling Stone, made an offer for CNN, but Zaslav balked, thinking he was being low-balled. It’s not clear if he will sell assets individually, but Zaslav is more likely to sell them all as one big package.
Deadline reported additionally that Paramount Skydance has its eyes on all the Warner IP. “The real play here is the control of a massive amount of IP. It just completely changes the leverage when you have everything from Harry Potter, HBO and DC to Taylor Sheridan, Tom Cruise movies and the NFL,” said an industry veteran who deals with both sides.
There is also a question of whether Paramount and WBD’s streaming crown jewels could coexist if they don’t merge or bundle. Insiders think Paramount+ and HBO Max executives would want to be left alone to continue doing their thing separately.
We can add to that the mixed feelings Zaslav might have in giving up Warner Bros., as mused by “one media veteran” to Deadline, “the bigger question is really, is David Zaslav willing to give up his mantle? He’s going to go with Warner. He sees [what it does] for his reputation in Hollywood.”
