The long-simmering speculation around a Warner Bros. Discovery sale erupted into public view this week after The Wall Street Journal reported that Paramount and Skydance are preparing a takeover bid. The move signals a new phase of consolidation in Hollywood that could place two of the industry’s most storied studios under one roof.
Warner Bros. Discovery shares surged nearly 30% on Thursday, closing at a three-year high, while Paramount shares climbed more than 15% the news. Analysts say the potential offer could spark a bidding war for Warner Bros. Discovery, with companies such as Comcast, Amazon, and Netflix mentioned as possible contenders.
David Ellison, fresh off completing Skydance’s $8.4 billion merger with Paramount Global in August, is wasting little time pursuing further consolidation. Backed by the financial firepower of his father, Larry Ellison, one of the world’s richest men, Ellison has already secured UFC broadcast rights, exclusive talent partnerships and a deal with Activision for a Call of Duty film. Now he appears to be turning his focus to Warner Bros. Discovery, which CEO David Zaslav has been preparing to split into two entities by 2026: Discovery Global, housing CNN and other linear networks, and Warner Bros., which includes the studio, HBO, HBO Max and DC Comics. Paramount’s reported offer would target the entire company, sidestepping the formal split.
Any acquisition of Warner Bros. Discovery would likely draw scrutiny from the Justice Department. The deal would combine two of Hollywood’s legacy studios and could reduce competition across film, television and streaming. While the transaction would not require FCC approval, the political environment complicates matters. Warner Bros. Discovery owns CNN, a frequent target of Donald Trump, even as the Ellisons have maintained ties with him. Analysts suggest regulatory approval could become entangled with broader political and ideological issues.
Bank of America analyst Jessica Reif Ehrlich said the only surprise in the Journal’s report was the timing. “It’s obvious the media industry needs to consolidate,” she said. Others note that if Paramount makes a formal offer, it likely will not be the only one. Comcast, Amazon and Netflix are among the companies rumored to have interest in Warner Bros. Discovery, either in whole or in part.
Industry veteran John Malone, chair emeritus of Warner Bros. Discovery’s board and a longtime mentor to Zaslav, recently said he has conferred with Ellison about further consolidation. Speaking to The New York Times, Malone said he would “bet on that guy,” after meeting with Ellison at the annual Sun Valley media conference last summer.
Whether Paramount ultimately closes a deal or sparks a larger auction, the pressure is clear. As streaming matures, the sector is tilting back toward a handful of dominant players, resembling the old broadcast era far more than the open, competitive market that many once expected.
