In one of the most highly anticipated bidding duels in recent media history, Warner Bros. Discovery is expecting fresh bids Monday at a deadline it set to extract a higher price for all or parts of its operations.
Two weeks ago, the David Zaslav-led media giant received first round, non-binding bids from Netflix and Comcast, and a fourth bid from Paramount for the entire company after its three previous takeover offers were rejected for being too low.
After reviewing any improved offers that might arrive today, the Warner Bros. Discovery board may decide to enter into a period of exclusive negotiations with one of the companies.
Warner Bros. Discovery stock was trading essentially flat early on Monday at $23.86.
The New York Post over the weekend reported that senior White House officials have expressed anti-trust concerns about a potential WBD-Netflix combination, “raising doubts whether such a deal would give Netflix too much power over Hollywood.”
Experts previously told TheWrap that, while a Comcast bid for Warner Bros. makes strategic sense, it would face challenges securing regulatory approval from the Trump administration and beating the deep pockets of the Ellison family.
By requesting a second round of bids, Zaslav is clearly looking for an offer that is closer to $30 per share, rather than in the mid-$20 range, which is where the Paramount offers have landed.
Consider some of the history over the past three months.
$12.54 — This was WBD’s closing price on Sept. 10, the day before Bloomberg broke the news that Paramount was preparing a bid.
$16.17 — This was WBD’s closing price the next day, showing a 29% bump on a so-called takeover premium. The stock has risen steadily since due to more takeover speculation.
Takeover offers in the media space have been attracting a 20% to 25% premium.
If Paramount did indeed see an offer of $30 per share offer, that would represent a 139% premium from the $12.54 where WBD was languishing before the takeover news broke.
This story is developing. Check back at TheWrap for updates throughout the day.
