Warner Bros. Discovery CEO David Zaslav wants bidding war for his media giant — even as Paramount Skydance plans takeover offer: sources

Warner Bros. Discovery CEO David Zaslav is actively orchestrating a bidding war for the media conglomerate, engaging major tech and media players including Amazon, Apple, and Netflix, even as David Ellison's Skydance prepares a multi-billion-dollar all-cash takeover offer. Zaslav aims to significantly drive WBD's stock price from its current ~$16, with shares already surging nearly 30% on the news of Skydance's interest. This strategy is underpinned by a belief in a more conducive M&A regulatory environment, potentially under a future Trump administration, and the strong demand for content from cash-rich tech platforms.

Analysis

Warner Bros. Discovery (WBD) is actively engineering a strategic M&A event, catalyzed by a pending multibillion-dollar takeover offer from David Ellison's Skydance. CEO David Zaslav is leveraging this interest to orchestrate a wider bidding war, engaging bankers at Goldman Sachs to solicit bids from tech giants including Amazon, Apple, and Netflix. This news has already had a material impact, causing WBD's stock to surge nearly 30% from its prior close above $16, with management reportedly targeting a valuation of $40 per share. This strategic pivot from internal restructuring—primarily focused on paying down $35 billion in debt—to external value realization through a corporate sale reflects a belief in two key factors: a more favorable regulatory environment for mergers, particularly under a potential Trump administration, and the sustained, high-level demand for established content libraries from cash-rich technology platforms. The situation is complicated by WBD's planned split into two separate public companies by next April, creating uncertainty as to whether the company will be sold in its entirety or as separate studio/streaming and network assets.

Key Decisions for Investors

• Investors should re-evaluate Warner Bros. Discovery (WBD) positions, as the investment thesis has shifted from a debt-reduction turnaround story to a special situation M&A play, where the primary driver is the potential for a significant takeover premium toward the stated $40 target.
• Closely monitor for the emergence of a formal, all-cash offer from Skydance or competing bids from the named tech giants, as the current stock price is heavily supported by M&A speculation rather than immediate fundamentals.
• Consider the announced April spin-off plan as a key variable; a sale of the entire company would negate this plan, while its progression could signal that a holistic deal is not imminent, potentially leading to the sale of individual assets like CNN.
• This event reinforces the high strategic value of content libraries for technology platforms, suggesting potential for further consolidation and valuation uplifts across the broader media and entertainment sector.