Entertainment giant Paramount Skydance (PSKY) is reportedly planning a takeover bid for rival Warner Bros. Discovery (WBD).
Warner Bros. Discovery has yet to receive a formal offer from Paramount Skydance, according to media reports. However, a bid is expected in coming days.
Shares of Warner Bros. Discovery jumped nearly 30% to close at $16.15 U.S. a share on Sept. 11 on the takeover speculation. It was the stock’s best one-day performance ever.
The stock of Paramount Skydance rose 15% on news of a potential Warner Bos. acquisition.
Warner Bros. Discovery recently announced plans to separate its struggling television networks from its more profitable streaming business and film studios.
However, media reports say that the Paramount Skydance bid would be an all-cash offer for the entirety of Warner Bros. Discovery.
The media and entertainment industry continues to be transformed by streaming, which has upended traditional television networks and the moviegoing experience.
A merger between Paramount Skydance and Warner Bros. Discovery would create an entertainment colossus with a huge portfolio of pay TV networks, broadcast sports rights, and multiple film studios.
Paramount Skydance already owns the CBS television network, as well as specialty channels such as MTV and Nickelodeon, and the Paramount+ streaming service.
Paramount’s film franchises include “The Godfather” and “Top Gun.”
For its part, Warner Bros. Discovery owns TV networks such as CNN, as well as HBO and streaming service HBO Max. Its film franchises include “Harry Potter” and “The Lord of the Rings.” It also owns D.C. Comics, home to characters such as Batman and Superman.
Both companies have a long list of broadcast sports rights, including for NFL football and Major League Baseball, as well as college football and basketball.
There is speculation on Wall Street of a growing wave of mergers and acquisitions (M&A) under the supportive administration of U.S. President Donald Trump.
PSKY stock is up 49% this year and trading at $17.46 U.S. per share. WBD stock has gained 52% on the year to trade at $16.17 U.S. a share.
