$71B Warner Bros Discovery Bid Report Denied by Paramount Skydance

• Paramount Skydance denies Variety report of a $71 billion bid for Warner Bros. Discovery backed by Gulf sovereign funds.
• Multiple companies, including Comcast and Netflix, are competing ahead of the Nov 20 offer deadline.
• Paramount explores stronger funding options while WBD may raise its share offer.

Paramount Skydance has explicitly refuted a Variety report that claims, company is building a $71 billion acquisition bid for Warner Bros. Discovery (WBD) with the support of sovereign wealth funds from Saudi Arabia, Qatar, and Abu Dhabi. A representative for the company revealed in a statement,  “The information Variety published is categorically inaccurate. This is a confidential process … and, as such, will not be commenting until the process is over.”

Variety cited anonymous sources stating that the Ellison family had complete voting control of Paramount Skydance. According to the story, the family is preparing a bid alongside significant Gulf sovereign wealth funds like Saudi Arabia's Public Investment Fund (PIF), the Qatar Investment Authority (QIA), and the Abu Dhabi Investment Authority (ADIA). 

These sovereign funds, reportedly, would put in about $7 billion, with Paramount Skydance contributing roughly $50 billion. Under this framework, the funds would own a modest minority stake, while acquiring various media-related rights, including "an IP, a movie premiere, a movie shoot."

Nonetheless, Warner Bros. Discovery's management has set a November 20 deadline for the non-binding first round of offers. Apart from Paramount, this has also attracted interest from other significant companies such as Comcast and Netflix. Notably, an early Paramount bid, listed at approximately $23.50 per share, had been rejected by WMD. 

Warner Bros. Discovery Looking for Better Offers?

This is not the first time that Warner Bros. Discovery has declined a Paramount offer. As per industry reports, in October, WBD rejected a $20-per-share offering as too low. This prompted Paramount to look into more aggressive funding options, including reported conversations with Apollo Global Management, to strengthen its bid.

But, on Nov 18, Reuters cited an Axios report stating that WBD is allegedly seeking to increase the offer from $23.50 per share to about $30 per share. It also detailed Paramount's offer, which intended to provide roughly 80% in cash and 20% in stock.  

The move emphasizes the ongoing tug-of-war over Warner Bros. Discovery, with various buyers attempting to outbid one another. As Paramount Skydance negotiates confidentially and explores potential financing possibilities, the conclusion will most likely be determined by shareholder response and the board's review of competing offers. WBD's November 20 deadline for initial bids adds urgency, paving the way for a potentially high-stakes bidding battle.