Warner Bros. Discovery puts itself up for sale, citing interest from ‘several’ suitors

Warner Bros. Discovery, CNN’s parent company, is considering a sale.

The media giant says it has received “multiple” expressions of interest from potential buyers, indicating that Paramount Skydance is not the only suitor for the media company.

In a statement released Tuesday morning, WBD said its board of directors had begun a “review of strategic alternatives,” which could result in the sale of the entire company, continuation of the current plan to split the company in two, or some other outcome.

Paramount has made proposals to purchase all of WBD ahead of the planned split, signaling that a behind-the-scenes bidding war is underway. The WBD board rejected the first offer, two people with knowledge of the matter told CNN last week. One of the sources said both sides recognized it was a “low-ball” proposal from new Paramount CEO David Ellison.

Paramount declined to comment on its interest in WBD, but Ellison has kept up the pressure in recent days, according to sources.

Warner Bros. CEO Discovery CEO David Zaslav is preparing to split the company into two publicly traded halves, believing that Warner Bros. (which would host the HBO Max streaming service and movie studio) and Discovery Global (which would host CNN and other cable channels) would thus be much more valued.

WBD could still decide to finalize the planned split, but Tuesday’s announcement suggests other outcomes may be more likely.

Comcast is one of several other media industry heavyweights evaluating WBD’s assets, given Warner’s openness to a deal, two people with knowledge of the matter said. A Comcast spokesperson declined to comment.

Wall Street analysts have said Comcast and Netflix could be interested in the streaming and studio half of WBD, given the iconic brands and shows the company controls.

Rather than walking away next year, after the breakup takes effect, suitors will likely do their due diligence and consider an offer now, since WBD has said it is open to offers.

“It is not surprising that the significant value of our portfolio is increasingly recognized by other market participants,” Zaslav said in a statement. “After receiving interest from multiple parties, we launched a comprehensive review of strategic alternatives to identify the best path forward to unlock the full value of our assets. »

Zaslav told employees in a separate memo that “assessing potential interest, conducting due diligence and evaluating next steps will take time, likely over a period of weeks and months.” He said “there is no fixed timetable for final decisions.”

Zaslav outlined several possibilities: the already-planned split, “a transaction involving the entire company,” “separate transactions for Warner Bros. and/or Discovery Global,” or “an alternative separation structure that would allow a merger of Warner Bros. and a spinoff of Discovery Global for our shareholders.”

WBD shares were up more than 11% as of midday Tuesday.