(Nov 19): Paramount Skydance Corp said a report that it’s working with a consortium of Middle Eastern sovereign wealth funds on a US$71 billion ($92.49 billion) offer for Warner Bros Discovery Inc is inaccurate.
Variety reported that David Ellison’s Paramount Skydance is working with Saudi Arabia’s Public Investment Fund, the Qatar Investment Authority and the Abu Dhabi Investment Authority on a bid, citing people familiar with the talks.
“The information Variety published is categorically inaccurate,” a spokesperson for Paramount said in a statement to Bloomberg. “This is a confidential process, which we respect and, as such, will not be commenting until the process is over.”
The offer, which would value Warner Bros at about US$28.65 a share based on the shares outstanding, is being largely backed by the Ellison family with Gerry Cardinale’s RedBird Capital also supporting the bid, according to Variety. Each of the sovereign funds would contribute US$7 billion, and Paramount Skydance would lay out US$50 billion, Variety reported. The board of Warner Bros has previously rejected multiple offers from Paramount for as much as US$23.50 a share, Bloomberg has reported.
Representatives of the sovereign wealth funds didn’t immediately respond to a request for comment. Warner Bros shares jumped as much as 6.4% in New York on the initial Variety report before paring some of those gains. Paramount shares rose as much as 3.7%.
Warner Bros, the parent of HBO, CNN and its namesake film studio, put itself up for sale in October after receiving interest from multiple parties and has set a deadline for bids on Thursday. In addition to Paramount, Netflix Inc and Comcast Corp are also expected to make an offer for the film and streaming part of the business. Paramount is the only party interested in acquiring the whole of Warner Bros.
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A merger between Paramount and Warner Bros would reshape the media industry, uniting two of the biggest movie studios and two of the most influential news networks under one roof. Any deal is likely to attract regulatory scrutiny.
Ellison, the son of Oracle Corp chairman Larry Ellison, has been aggressively pursuing Warner Bros., fresh off the US$8 billion purchase of Paramount in August, which he combined with Skydance. The Ellisons appear to have the backing of US President Donald Trump and have argued that Paramount’s offer represents the most straightforward deal.
Warner Bros chief executive officer David Zaslav favours splitting the company in two as it had originally planned, as he expects the film and streaming assets could fetch a premium if separated from the beleaguered cable TV assets.
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