Netflix, Paramount and Comcast have submitted bids for Warner Bros. Discovery, TheWrap has learned. The first round of non-binding bids for all or part of the media giant were due Thursday, with a final decision expected to be made around Christmas.
Details of the bids could not immediately be learned. Representatives for Netflix, Comcast, Paramount and Warner Bros. Discovery declined to comment.
Warner Bros. Discovery launched a strategic review of alternatives in October, citing “unsolicited interest” from “multiple parties.”
Netflix and Comcast have been exploring bids for Warner’s studio and streaming business, which is on track to split from its linear networks business in April. Meanwhile, Paramount has previously submitted three separate takeover offers for the entire company, which ranged from $19 to $23.50 per share and were rejected for being too low.
Paramount CEO David Ellison has argued the company would be the “best partner” for Warner, adding that other potential acquirers would need to overcome “significant (perhaps insurmountable) hurdles given their dominant market positions.”
In an Oct. 13 letter to WBD’s board, Paramount claimed that the value to shareholders in a break-up would be less than $15 per share or roughly $18 to $20 per share, including a “robust, yet highly uncertain, M&A premium for Warner Bros,” an individual familiar with the matter confirmed to TheWrap.
In order to sweeten the bid, Ellison previously offered WBD CEO David Zaslav a co-CEO and co-chairman title and said the company would increase the portion of its bid paid in cash to shareholders from 60% to 80% and breakup fee from $2 billion to $2.1 billion. The company is also in advanced discussions with Saudi, Qatari and United Arab Emirate sovereign wealth funds about investing in its bid, despite Paramount’s official denials.
If successful in acquiring WBD, TheWrap previously reported that Ellison would look to merge HBO Max and Paramount+ into a “super platform” under one scenario being considered. The theatrical model is also at the core of his vision and a combined company would look to target an output of 30 films per year as part of its commitment to that model.
Comcast president and soon-to-be co-CEO Mike Cavanagh recently said the company’s bar for M&A remains “very high” and that its current strategies are “really sound and durable without M&A.”
But he also acknowledged that the company would “look at things that are trading in the space around our industry” and figure out if there’s ways to add value, suggesting the company would be open to a deal for WBD’s studio and streaming following its own cable network spinoff into Versant, which is set to launch as a standalone, publicly-traded company by the end of the year.
TheWrap previously reported that Zaslav met with Comcast CEO Brian Roberts as the latter was exploring a potential bid. Comcast retained Morgan Stanley and Goldman Sachs to help evaluate a potential offer.
Experts previously told TheWrap that, while a Comcast bid for Warner Bros. makes strategic sense, it would face challenges securing regulatory approval from the Trump administration and beating the deep pockets of the Ellison family. But Cavanagh appeared to be less concerned about the feasibility of a bid, saying he thinks “more things are viable than maybe some of the public commentary that’s out there.”
Netflix co-CEO Ted Sarandos reiterated during the company’s third quarter earnings call last month that it has “no interest” in acquiring legacy media networks, but said that the streamer believes it can and will be “choosy” with regard to M&A.
“It’s our responsibility to look at every significant opportunity,” co-CEO Greg Peters added at the time. “We’ve got a clear framework to evaluate those opportunities and we’ll do whatever we think is best to grow the business.”
The streamer would later retain Moelis & Co. to evaluate a potential offer.
Ahead of Thursday’s bid deadline, Zaslav hosted a starry dinner at his home with guests Oprah Winfrey, CAA CEO Bryan Lourd, Al Pacino, Sandra Bullock, Bette Midler, Lorne Michaels and Margot Robbie, among about a dozen others. The evening was not related to the expected bids from Paramount, Comcast and Netflix, TheWrap has learned, but it certainly caught the attention of Hollywood players and emphasized Zaslav’s ability to bring the industry’s biggest names together under one roof.
The bids come after the Writers Guild of America warned that a merger between Warner Bros. Discovery and Paramount or another major studio or streamer would be a “disaster for writers, for consumers and for competition” and that it would work with regulators to block a potential deal.
When asked about the prospect of a WBD sale, the California Department of Justice previously told TheWrap exclusively that “further consolidation in markets that are central to American economic life — whether in the financial, airline, grocery or broadcasting and entertainment markets — does not serve the American economy, consumers or competition well.”
“We are committed to protecting consumers and California’s economy from consolidation we find unlawful,” the spokesperson added.
In a Nov. 13 letter to U.S. Attorney General Pam Bondi, FTC Chair Andrew Ferguson, Assistant Attorney General for the DOJ’s Antitrust Division Gail Slater and Republican Rep. Darrell Issa warned that a Netflix bid for Warner Bros. would raise antitrust concerns and “diminish incentives to produce new content and major theatrical releases,” which could “undermine opportunities for the full range of industry professionals, both in front of and behind the camera.”
Bloomberg reported that Netflix has told WBD management it would keep releasing the studio’s films in theaters if it’s successful in buying the company.
Sens. Elizabeth Warren (D-MA), Bernie Sanders (I-VT) and Richard Blumenthal (D-CT) have asked that the Department of Justice ensure any deal for WBD be “conducted transparently, independently and in accordance with federal antitrust and anti-corruption laws” and not be based on “President Trump’s political favoritism.”
A DOJ Official told TheWrap on Thursday, “The DOJ Antirust Division takes pride in our ability to review mergers effectively and efficiently. We look forward to applying these standards to any potential or hypothetical deal involving Warner Brothers.”
Trump, who has repeatedly praised the Ellison family, recently hosted David Ellison during an East Room dinner for Saudi Crown Prince Mohammed bin Salman on Tuesday.
Shares of Warner Bros. Discovery, which closed at $22.88 apiece on Thursday, have climbed 129.95% in the past year, 114.6% year to date, 147.9% in the past six months and 24.9% in the past month.
The New York Times first reported the news of Thursday’s bid submissions.
