WBD announces strategic review of assets, says it's open to a sale
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Warner Bros. Discovery CEO David Zaslav. Photo: Kevin Dietsch/Getty Images
Warner Bros. Discovery shares popped roughly 10% Tuesday morning after the media giant said it launched a strategic review of opportunities to maximize shareholder value, including a possible sale.
Why it matters: The review, it said, comes in response to "unsolicited interest" that the company has received "from multiple parties for both the entire company and Warner Bros.," its film studio.
Zoom in: The review signals WBD's willingness to consider a possible sale, rather than moving forward with its previously announced plan to split the company into two publicly traded companies, parting its television networks from its streaming business.
- "Through this process, the Warner Bros. Discovery Board will evaluate a broad range of strategic options, which will include continuing to advance the Company's planned separation to completion by mid-2026, a transaction for the entire company, or separate transactions for its Warner Bros. and/or Discovery Global businesses," the company said in a press release.
- "As part of the review, the Company will also consider an alternative separation structure that would enable a merger of Warner Bros. and spin-off of Discovery Global to our shareholders."
Catch up quick: WBD had reportedly rejected an initial takeover bid from Paramount Skydance of $20 per share earlier this month.
- WBD, which comes saddled with around $35 billion in debt, was trading at around $18 per share last week, giving it a market cap of roughly $44 billion.
- Paramount Skydance is roughly half the size of WBD in terms of market value, but its bid would be bolstered by Larry Ellison, Paramount Skydance chair and CEO David Ellison's father.
What to watch: The company said there is no deadline or definitive timetable set for completion of the strategic alternatives review process and that there can be "no assurance that this process will result in the Company pursuing a transaction or other outcome."
