Warner Bros. Discovery shares soared Thursday after reports that Paramount Skydance, backed by Larry Ellison and his son David Ellison, is preparing a majority-cash offer to acquire the entire media conglomerate, including its movie studios, streaming assets, and cable television networks.
Shares of WBD spiked as much as 36% intraday and closed nearly 29% higher at $16.17. Paramount Skydance shares also climbed 9% on the news. The Wall Street Journal first reported that the Ellison-backed group is exploring a takeover bid, a deal that would combine two of Hollywood's largest studios and streaming platforms.
The potential transaction comes just weeks after Skydance closed its $8.4 billion acquisition of Paramount Global, a deal that was politically contentious and required Federal Communications Commission approval. As part of that merger, Skydance agreed to hire an ombudsman to address complaints of bias at CBS News and paid $16 million to settle President Donald Trump's lawsuit against CBS.
While Warner Bros. Discovery has not received a formal offer, people familiar with the matter told CNBC that "plans could still fall apart." A spokesperson for WBD declined to comment, and Paramount representatives have not responded to requests for comment.
CEO David Zaslav is in the midst of a major corporate restructuring, planning to split WBD into two businesses by April 2026 - one focused on streaming and studios under the Warner Bros. name, and the other housing global cable assets such as CNN, TNT, and TBS under Discovery Global. Zaslav is slated to remain CEO of the newly named Warner Bros. while longtime CFO Gunnar Wiedenfels would lead the cable division.
The scale of the prospective acquisition is significant. WBD's market capitalization is roughly $33 billion, more than double that of Paramount Skydance. A deal would consolidate massive streaming services - Warner's HBO Max and Discovery+ with Paramount+, which together boast over 200 million subscribers - creating a formidable competitor to Netflix and Disney+.
Regulatory and antitrust scrutiny is likely, though analysts note the merger would not require broadcast divestitures since WBD does not own a network. Still, Warner Bros.' ownership of CNN could invite political friction. "Even though Donald Trump has praised the Ellisons, Warner Bros. Discovery owns CNN, a target of the president's attacks even more than CBS News ever was," Deadline reported.
