Paramount Skydance CEO David Ellison speaks during the Bloomberg Screentime conference in Los Angeles on October 9, 2025.
Patrick T. Fallon | AFP | Getty Images
That’s not exactly what David Ellison planned for September.
Just a few months ago, Paramount Skydance The CEO sent a message to Warner Bros. Discovery The board argued that combining the two media and entertainment companies made sense. That letter was the first of many that offered increasingly higher prices to acquire the company with her Arguments why the assets were better together.
Paramount’s interest in A.J Official sales process – Bring Comcast and Netflix into the mix – ultimately doubling the value of Warner Bros.’ stock. Discovery, culminating, at least for now, with Paramount losing out on the bidding war it started.
Friday, Netflix announced a deal To acquire HBO Max and Warner Bros. film studio Famous for $27.75 per share, or an equity value of $72 billion. WBD will move forward with a plan to spin off its pay-TV networks, such as CNN and TNT Sports, before the deal closes.
Instead of consolidating Paramount, just months after taking control of the company through a merger with SkyDance, Ellison effectively handed over a valuable jewel of the media and entertainment industry to the most dominant player, enhancing Netflix’s reach and stripping Paramount and Comcast’s NBCUniversal of an obvious merger target.
“It wasn’t for sale before, and they certainly weren’t cleaning up assets or separating assets the way they are doing now,” Netflix co-CEO Ted Sarandos said on a conference call Friday morning after the deal was announced. “I think this kind of goes to ‘why now’.”
Ellison started an operation that made a lot of money for the Warner Bros. CEO. Discovery David Zaslav, the WBD executive team and its shareholders.
Share Zaslav
Zaslav currently owns more than 4.2 million shares of Warner Bros. Discovery, with another 6.2 million shares to be delivered to it in the future via previously granted stock awards, according to Equilar. Zaslav also found an endowment of about 20.9 million options with an exercise price of $10.16.
Based on the Netflix-WBD deal price of $27.75 per share, this all adds up to more than $554 million for WBD’s CEO.
Factoring in another 4 million shares that Zaslav is scheduled to receive in January, according to a person close to the situation who declined to be named speaking about the CEO’s holdings, the true total is closer to $660 million.
For shareholders, the sale brought a similar windfall. Warner Bros. stock closed. Discovery at $12.54 on September 10, a day before the Wall Street Journal reported that Paramount was preparing a bid for the company.
On Friday morning, Warner Bros. shares rose. Discovery rose approximately 3% to more than $25 per share. That’s more than double the unaffected sale price to Warner Bros. Discovery and back to 2022 levels when WarnerMedia and Discovery first merged.
This is vindication for Zaslav, who spent nearly four years under fire from Hollywood and investors for failing to deliver what shareholders wanted. With Friday’s announcement, victory has effectively been snatched from the jaws of defeat.
However, Paramount likely isn’t done with its quest to buy all of Warner Bros.’ productions. Discovery.
Paramount Hostile Play
Ellison He didn’t waste any time At the helm of Paramount Skydance, he transformed the company through deals and acquisitions.
Since the merger closed in August, Paramount has scooped up high-profile Hollywood executives and talent such as Dover brothers. It has acquired the rights to develop a live-action feature film based on Activision Call of Duty video game franchise And hit a $7.7 billion deal for UFC rights.
Ellison’s search for Warner Bros. Discovery is his biggest endeavor since taking control of the company.
Paramount’s lawyers sent a letter to Warner Bros. Discovery this week first Reported by CNBCClaiming that the sale was rigged in favor of Netflix. Paramount accused Warner Bros. Discovery failed to properly consider its $30 all-cash offer, instead selling to Netflix as a predetermined outcome.
Netflix made an initial offer for WBD’s studio and streaming assets at $27 a share, according to a person familiar with the matter. That trumped Paramount’s offer at the time and shifted sales talks in Netflix’s direction, said the person, who asked to remain anonymous because the discussions were private.
Paramount was the only bidder interested in acquiring all of WBD’s assets – the film studio, streaming service and television networks. She confirmed that her offer was superior.
Paramount executives and advisers valued Discovery Global Networks’ portfolio at roughly $2 a share, based on an expected trading multiple and estimated leverage ratio, according to people familiar with the matter, who asked to remain anonymous because the discussions were private. Discovery Global will include CNN, TNT Sports and Discovery.
Warner Bros. believes Discovery Global could be worth $3 per share or more if it trades well in the public markets, according to other people with direct knowledge of the matter.
Paramount has also argued that there are tax efficiencies for shareholders in acquiring the entire company rather than just part of it, and that Netflix’s bid comes with steeper regulatory risks. The Trump administration’s view of the proposed group is one of “extreme skepticism.” CNBC reported on Friday.
Paramount has offered a $5 billion breakup fee if the proposed deal does not receive regulatory approval, according to people familiar with the matter.
Netflix’s offer includes a $5.8 billion breakup fee if the deal doesn’t receive regulatory approval, the Securities and Exchange Commission said Friday.
Paramount is now weighing its options on whether to go directly to shareholders with another enhanced offer — perhaps higher than the all-cash offer of $30 per share it submitted to WBD this week.
If that happens, Netflix will have a chance to match this offer. The end result will mean more money for WBD shareholders — and more money for Zaslav.
— CNBC’s Nick Wells contributed to this report.
Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC. Versant will become the new parent company of CNBC based on Comcast’s planned spin-off of Versant.
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2025-12-05 19:30:00
