Warner Bros. Discovery Reviews Strategic Options Amid Unsolicited Interest

Warner Bros. Discovery (WBD) is assessing strategic alternatives after receiving unsolicited interest from multiple parties regarding both the entire company and its standalone streaming and studios division. The company did not disclose the identities of the interested parties.

In recent weeks, WBD reportedly declined a $20-per-share acquisition offer from Paramount Skydance, considering it undervalued. Following the announcement of the strategic review, WBD's stock rose over 8% in early trading, nearing $20 per share.

The company continues to progress with its planned separation into two entities: Warner Bros., encompassing streaming and studios, and Discovery Global, focusing on television networks. This separation is targeted for completion by April 2026. Concurrently, the board has initiated a review of strategic options to maximize shareholder value, which may include selling the entire company or individual transactions for its Warner Bros. and/or Discovery Global businesses.

As part of this review, WBD is also considering alternative separation structures, such as merging Warner Bros. with a third-party acquirer while spinning off Discovery Global to shareholders.

"We continue to make important strides to position our business to succeed in today’s evolving media landscape by advancing our strategic initiatives, returning our studios to industry leadership, and scaling HBO Max globally," said David Zaslav, President and CEO of WBD.

"It’s no surprise that the significant value of our portfolio is receiving increased recognition by others in the market. After receiving interest from multiple parties, we have initiated a comprehensive review of strategic alternatives to identify the best path forward to unlock the full value of our assets," Zaslav added.

Samuel A. Di Piazza Jr., Chairman of the WBD board, stated, "Our decision to initiate this review underscores the board’s commitment to considering all opportunities to determine the best value for our shareholders. We continue to believe that our planned separation to create two distinct, leading media companies will create compelling value. That said, we determined taking these actions to broaden our scope is in the best interest of shareholders."

WBD has not set a definitive timetable for completing the strategic review and stated that, apart from the ongoing separation process, there is no assurance that this review will result in any transaction or other outcome. The company does not intend to make further announcements regarding the review unless the board approves a specific transaction or deems further disclosure appropriate.

Financial advisors for WBD include Allen & Company, J.P. Morgan, and Evercore, with legal counsel from Wachtell Lipton, Rosen & Katz, and Debevoise & Plimpton LLP.