Warner Bros Reportedly Rejects Initial Paramount Takeover Offer — But David Ellison Isn’t Done Yet

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A potential merger between Hollywood giants may be facing its first hurdle. Bloomberg reports that Warner Bros. Discovery has turned down an initial bid from Paramount and Skydance to buy the company. This suggests Warner Bros. Discovery is confident in its current position and could lead to further negotiations and competing offers.

A Lowball Offer Rebuffed

According to sources who are following the discussions, Warner Bros. Discovery considered Paramount’s first offer of around $20 per share to be too low. This rejection happened recently as Warner Bros. Discovery’s CEO, David Zaslav, and the board evaluated how much the company is actually worth, especially with plans to split the company next year.

Warner Bros. Discovery closed trading on Friday at $17.10 per share, valuing the company at around $42.3 billion. Paramount offered $20 per share, but Warner Bros. Discovery apparently believes this price doesn’t fully reflect the benefits of its planned changes. Paramount’s stock closed at $17 per share, giving it a market value of approximately $18.6 billion.

David Ellison, who leads Paramount (and is the son of Oracle’s founder), believes the entertainment industry is heading towards fewer, larger companies. He recently finalized a deal to combine Skydance and Paramount Global for $8 billion, giving him control of brands like CBS, Nickelodeon, and MTV. Now, it appears his next goal is to acquire Warner Bros. Discovery, the company behind HBO, DC Studios, CNN, and Warner Bros. Pictures.

Zaslav Holds the Line

David Zaslav, the CEO, likely won’t sell Warner Bros. Discovery anytime soon. The company plans to divide into two businesses next year: one for streaming and film/TV production, and another for traditional cable channels. Reports suggest the bulk of the company’s debt will remain with the cable side, making the streaming and production side financially healthier and more promising.

David Zaslav thinks Warner Bros. Discovery has a bright future, and selling the company now, before its full potential is realized, could cost billions. Bloomberg Intelligence analysts agree, stating that Warner Bros. is in a stronger position than Paramount, which is more reliant on a deal to improve its standing.

Look, if Larry Ellison really wants to get this Warner merger done, he’s going to have to show Warner’s team exactly how much value they’ll get out of it after the split. Or, honestly, he’s just going to have to make an offer they can’t possibly turn down. It’s pretty simple, really.

Paramount’s Next Moves

Paramount Skydance is considering several options regarding its current offer, such as increasing the amount it’s offering, finding a company to invest with, or making a deal directly with Warner Bros. owners.

While a hostile takeover would be rare in today’s Hollywood, it remains a possibility for Paramount. The company has already been talking with Apollo Global Management, an investment firm that often funds major media transactions, about potential financial support.

Paramount is aiming to grow by offering more content and becoming a stronger competitor in the streaming market. A merger with Warner Bros. would put all of these major brands – including Paramount+, CBS, Nickelodeon, HBO Max, DC, and Warner Bros. Pictures – under one umbrella. This combined company would instantly become a major force, potentially challenging Disney and Netflix.

Regulatory & Financial Hurdles

Still, even if Paramount raises its offer, the road ahead is anything but clear.

Okay, so the idea of Paramount and Warner Bros. merging? It’s not going to be a smooth process. The FTC and Justice Department are really cracking down on big companies combining these days, and this deal would definitely get a *lot* of attention. Think about it – between the two of them, they control news, sports, and huge movie and TV franchises. If they *do* merge, I’m expecting they’ll have to sell off some major assets just to get it approved. It’s a complicated situation, to say the least.

Adding to the challenge is the cost. Even a relatively small increase in price to acquire Warner Bros. Discovery could exceed $50 billion when you include existing debt and the expenses of combining the companies. That’s a significant financial undertaking for any company, especially one that has just finished merging with another.

The Ellison Factor

During the Bloomberg Screentime conference in Los Angeles, Netflix CEO Ted Sarandos didn’t discuss the potential Warner Bros. merger directly. However, he indicated he believes further consolidation is needed to strengthen the entertainment industry and help streaming services expand.

“There’s a lot of options out there,” Ellison said.

This quiet confidence suggests Paramount is prepared to remain a contender, and might even increase its offer if necessary.

The Bigger Picture: Who Needs Whom?

Both companies are facing difficulties in the entertainment industry, but Paramount seems more eager to make a deal. The merger with Skydance hasn’t shown a clear path to growth, and Paramount+ is still behind other streaming services in attracting subscribers. Warner Bros., on the other hand, has strong content thanks to hits like *Dune*, *The Batman*, and *House of the Dragon*, although they are still dealing with a significant amount of debt.

Experts predict David Zaslav’s position is strengthening with each passing day. After Warner Bros. Discovery separates its businesses, the streaming and studio portion of the company is expected to be worth significantly more, potentially making the current acquisition offer seem inadequate in the future.

If Paramount wants this deal, it may need to act fast and act big.

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2025-10-13 15:57