According to a new report, Warner Bros. Discovery has begun looking into a potential merger with Paramount Global, a deal that would be sure to rock the entertainment industry.
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Axios is reporting that Warner Bros. Discovery CEO David Zaslav met with Paramount Global CEO Bob Bakish on Tuesday for several hours. WBD is also said to have begun securing bankers to look into the potential of the two companies merging. Their values as of Wednesday was $29B for WBD, and $10B for Paramount.
The two are said to have discussed how the two companies would complement one another in a potential merger, with one of the key factors being the merger of Paramount Plus and Max to build a bigger rival to Netflix and Disney Plus.
The ownership of Paramount is a bit tricky as it is actually owned by National Amusements Inc. (NAI). Warner Bros. is said to be exploring purchasing NAI or Paramount as a separate entity.
Pressure has been mounting on Paramount as of late to find a strategic partner or an outright sale as it is currently staring down over $10B in debts. Skydance Media and RedBird Capital Partners were both said to be exploring buying a majority stake in NAI earlier in November. It has already sold off its Simon & Schuster publishing arm and has been exploring a potential sale of the BET service.
The potential deal is still in the earliest stages, and may not result in any purchase, but the synergies that would exist between the two companies would be difficult to ignore. Far beyond the streaming services merging, Paramount has an enormous war chest of franchises it brings with it as well as numerous cable channels such as Nickelodeon, MTV, Comedy Central, and not to mention the CBS network.
For now, everything will remain in preliminary talks as WBD has to wait out a tax bonus it took from its last merger deal to expire in April of 2024. As soon as that expires, it appears the company will very much be open for new deals.
