Warner Bros. Discovery Rejected Paramount Skydance Acquisition Offer of $20 per Share as Too Low (Report)

Warner Bros. Discovery rejected a takeover offer of “around” $20 per share from David Ellison’s Paramount Skydance in recent weeks as “too low,” Bloomberg News reported Saturday, citing anonymous sources.

WBD shares closed at $17.10/share Friday, up more than 36% since news broke Sept. 11 of Ellison’s interest in bidding for the rival just weeks after closing Skydance’s deal to acquire Paramount Global. Warner Bros. Discovery, parent of HBO/HBO Max, Warner Bros. Entertainment, CNN, TNT, TBS and more, has a market cap of $42.3 billion. The Bloomberg story did not indicate whether Paramount’s bid included the assumption of WBD’s total debt (which as of June 30 was $35.6 billion).

Paramount Skydance has been in talks with Apollo Global Management, the asset management firm that had previously bid for Paramount Global, about joining its bid for Warner Bros. Discovery, Bloomberg reported. Larry Ellison, the billionaire Oracle founder who is David’s father, fronted most of the money for Skydance’s $8 billion deal for Paramount Global.

Reps for Paramount, WBD and Apollo did not respond to requests for comment Sunday.

Ellison, speaking last week at L.A.’s Bloomberg Screentime conference, did not confirm that Paramount Skydance has bid for WBD. But he went on to explain why he thinks Paramount needs to bolt on more content-producing engines to achieve sustainable growth in today’s streaming-centric world and cited WBD chief David Zaslav’s comments that the industry needs more consolidation.

“I do think there’s a lot of [M&A] options out there that in terms of what actually might be actionable in the near future,” Ellison said at the conference. “You actually need more content to yield more engagement. And so we would actually want to be in the business, through whatever lens we’re looking at” to produce “more movies, more television series” to get more scale and engagement. Ellison declined to name potential takeout targets.

Paramount Skydance’s bid for Warner Bros. Discovery would be for WBD in its entirety, as first reported by the Wall Street Journal. The M&A overture comes ahead of WBD’s plans to split into two separate companies next spring (Warner Bros., comprising studios and streaming, and Discovery Global, including TV networks and Discovery+).