Paramount Skydance is preparing a majority cash bid for Warner Bros. Discovery that is backed by the Ellison family, according to people familiar with the situation.
The bid will be for the entire company, including its cable networks and movie studio, the people said. Warner said late last year it planned to restructure into two operating divisions, one focused on the legacy cable-television business and the other on streaming and studios.
Warner Bros. had a nearly $33 billion market capitalization early Thursday, prior to The Wall Street Journal's report on the potential bid, more than double that of Paramount Skydance. A bid hasn't yet been submitted and the plans could still fall apart.
Warner shares rose nearly 30% on Thursday after The Wall Street Journal's report on the potential bid, while Paramount Skydance shares rose nearly 16%.
By preparing a play for the company before Warner's planned split, Paramount Skydance is attempting to pre-empt a potential bidding war for the studio and streaming unit that could include deep-pocketed technology companies such as Amazon.com and Apple.
If successful, such a deal would bring together two of Hollywood's most storied studios and the parent companies of streaming services HBO Max and Paramount+. Warner is home to "Barbie," DC Comics, Harry Potter and TV shows such as "The White Lotus," as well as cable networks CNN, TBS and TNT.
The scale of the potential combination could bring antitrust and regulatory scrutiny.
Skydance, run by David Ellison, the son of billionaire Larry Ellison, weeks ago closed its deal to merge with Paramount, which owns Nickelodeon, MTV, Comedy Central and its movie studio.
