The Bidding War for Warner Bros. Discovery Intensifies

Warner Bros. Discovery (A) US9344231041

The contest for control of Warner Bros. Discovery (WBD) is heating up, with competing proposals creating a complex landscape for shareholders. The situation has evolved beyond a simple acquisition battle, now featuring rival cash bids and growing external pressures that cast uncertainty over any potential deal's completion.

Two distinct cash offers are currently on the table, each with a different strategic focus. According to recent reports, Netflix has revised its proposal structure. It has moved away from a plan that included potential valuation fluctuations, opting instead for a straightforward all-cash bid targeting the company's studio and streaming assets. This offer values those segments at $27.75 per share, representing a total transaction value of approximately $83 billion.

Industry observers note this shift to a pure cash deal is tactical. It aims to eliminate shareholder concerns regarding stock market volatility and could accelerate the approval process. Reports suggest a potential shareholder vote could occur by April 2026. This move is also widely seen as a direct counter to the competing advance from Paramount Skydance.

Not to be outdone, Paramount Skydance has presented a more comprehensive and higher-valued proposal. Their competing bid stands at $30.00 per share, also structured as an all-cash offer, but with the intent to purchase the entire corporation. This would place the total enterprise value of Warner Bros. Discovery at roughly $108.4 billion.

A critical dynamic is the timeline. Paramount Skydance has extended the deadline for its tender offer to February 20, 2026. Furthermore, the company is reportedly actively campaigning to convince WBD shareholders to vote against any potential transaction with Netflix.

Asset Speculation and Mounting Headwinds

Alongside the bidding war for the whole company, speculation about the fate of individual high-profile assets persists. Media mogul Barry Diller has previously expressed interest in acquiring the CNN network. However, Warner Bros. Discovery management was quick to issue a definitive statement, clarifying that CNN is not for sale.

Simultaneously, regulatory scrutiny is increasing. A coalition comprising documentary filmmakers, independent cinema owners, and non-profit organizations has, according to Bloomberg, urged several state attorneys general to intervene and block the proposed Netflix deal. Their argument centers on the belief that such a consolidation could harm competition within Hollywood and negatively impact consumers. This development introduces significant risk that even a fully negotiated agreement could be delayed or derailed by political or legal challenges.

Key Deal Points:
* Netflix Offer: All-cash bid for studio & streaming assets. $27.75 per share (~$83 billion total).
* Paramount Skydance Offer: All-cash bid for the entire company. $30.00 per share (~$108.4 billion total).
* Paramount Tender Offer Deadline: February 20, 2026.
* CNN Status: Company states it is not for sale.
* Additional Risk: Growing regulatory pressure from public interest groups.

Market Sentiment Remains Cautious

Despite the presence of a higher offer, the market price for Warner Bros. Discovery shares continues to trade below both proposed valuations. The stock closed at €23.41 on Thursday, indicating investor skepticism about the likelihood of a successful deal—particularly at the premium price—or a market that is pricing in a higher probability of regulatory intervention.

Clear milestones now define the path forward. The current tender offer period from Paramount concludes on February 20. Additionally, the company's next quarterly earnings report, expected in late February, could influence how shareholders assess the competing proposals based on the firm's latest financial performance.

@ boerse-global.de | US9344231041 THE