Warner Bros. Discovery is for sale. The family that just made Bari Weiss one of the most powerful people in American journalism is doing everything it can to buy it.
The entertainment conglomerate, formed three years ago when Warner Media spun off from AT&T and merged with Discovery, Inc., announced plans this past summer to split back into two separate companies. Its functional studio and streaming arm, the source of the publicly traded company's value as a security, would thus be unshackled from its network TV business, which still generates a ton of cash but is a declining in value (as evinced by WBD's $9 billion write-down of its TV properties). The new TV company would also be a place for WBD to park its $38 billion debt load. WBD followed Comcast's lead in the matter, and at the time of the announcement claimed it would complete the process by mid-2026.
However, those plans changed in September when Larry and David Ellison entered the fray. In August, the Ellison family formally took over the Paramount conglomerate in an $8 billion deal, completing a process that lagged on for a year and only got done after Donald Trump's FCC extracted a bunch of concessions from the newly formed Paramount Skydance. Shortly before formally buying the Free Press for $150 million—empowering Bari Weiss to turn once-proud CBS News into a place that hosts Erika Kirk town halls and puts charismatic figures like Alan Dershowitz in front of an America desperate to hear from the disgraced friend of Jeffrey Epstein—the Ellisons had reportedly started getting the cash together to make a run at acquiring WBD. Their aim was to head off a potential bidding war, which, hilariously enough, they kicked off by trying to avert.
In October, WBD announced that despite its ongoing plans to split, it was now "reviewing all options" following "unsolicited interest" from multiple parties. At that point, WBD had rejected multiple bids from Paramount and another from an unnamed party, per CNBC, and Netflix and Comcast had decided to get in on the action. Amazon and Apple were interested at the beginning of the process, though they aren't mentioned in any recent reporting on the deal. Still, with at least three huge companies involved, WBD, which has a $60 billion market cap, was now the subject of a bidding war. Initial offers came in on Nov. 20, and the three remaining suitors made larger second-round bids on Monday.
Sources at WBD reportedly told CNBC that the winner could be announced "as early as next week." According to CNBC, the Comcast offer is more measured, since it is wary of taking on the aforementioned $38 billion in debt. Netflix, whose offer is "mostly cash," is the leader in the clubhouse, which has prompted the Ellisons to start publicly freaking out.
CNBC reported on Thursday that Paramount had sent a letter to WBD's board expressing its "serious concerns about the fairness and adequacy of the bidding process." The letter, which CNBC published in full, attempts to make a case that WBD is engaging in a "myopic process with a predetermined outcome that favors a single bidder," Netflix, out of an unfair and irrational disregard for Paramount. The letter details a meeting between WBD executives and European Union regulators, who expressed their dismay at the prospect of Paramount controlling so much of the media landscape. The tone is whiny, conspiratorial, and surprisingly alliterative, warning that the process has been "tainted by management conflicts, including certain members of management’s potential personal interests in post-transaction roles and compensation."
The letter seems unlikely to persuade the WBD board to accept a worse offer from Paramount over a better one from Netflix, but I don't think that's the true intent behind it. Paramount, which is at the very least quite cozy with the U.S. regulatory apparatus, is all but threatening to mount a hostile takeover if the board chooses Netflix: Its representatives can tell shareholders that the Trump FCC wouldn't support the Netflix deal, and has its own recent merger approval to offer as proof that it has the connections to get anything through. Paramount's formal ask is for the WBD board to create an independent "unbiased" (read: biased) committee to see through the sale—to Paramount, obviously.
"But at this point we must insist on assurances and steps taken to ensure that a truly fair and independent process is being conducted," Paramount's letter concludes, "both for Paramount’s benefit and in the interest of WBD’s stockholders." In other words: Let us win, or else.
