And then David Zaslav tried to move mountains. Or at least buy them. In a significant development that could reshape the media landscape, the Warner Bros. Discovery CEO and Paramount Global CEO Bob Bakish engaged in talks on Tuesday in New York City about the prospect of merging their respective companies, according to sources familiar with the matter.
The meeting, which took place at Paramount’s Times Square headquarters, extended over several hours and delved into potential areas of collaboration between the two media giants. One key aspect under consideration is the possible merging of their streaming services—Paramount+ and Max—to enhance competitiveness against industry leaders like Netflix and Disney+.
Market dynamics indicate that any potential merger would not be a union of equals, as of Wednesday, with Warner Bros. Discovery’s market value standing at approximately $29 billion, significantly surpassing Paramount Global’s valuation, which stood just over $10 billion.
The exact nature of the merger is yet to be determined, with both the acquisition of Paramount Global and its parent company, National Amusements Inc. (NAI), on the table as potential options. Warner Bros. Discovery is reported to have enlisted the services of bankers to navigate the complexities of the deal.
Insiders suggest that the potential merger holds the promise of substantial synergies. Warner Bros. Discovery’s robust international distribution network could potentially amplify Paramount’s franchises, while Paramount’s assets in children’s programming might play a pivotal role in advancing Warner Bros. Discovery’s long-term streaming ambitions. Discussions also extend to potential collaborations between CBS News and CNN, creating a formidable global news entity.
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Paramount is under mounting pressure to secure a strategic partner or buyer as it contends with a considerable debt burden. The media industry has witnessed an acceleration in consolidation efforts, with major players seeking synergies and competitive advantages in an evolving landscape.
Despite the active antitrust climate, executives involved in the discussions express confidence in obtaining regulatory approval. Notably, Warner Bros. Discovery’s lack of ownership of a broadcast network could simplify the regulatory process compared to potential mergers with companies holding such assets.
Axios notes that Zaslav’s strategic blueprint for the potential merger draws parallels with his past approaches, such as the acquisition of Scripps in 2018 and the merger with WarnerMedia in 2022.
While both Warner Bros. Discovery and Paramount Global declined to comment on the ongoing discussions, it is emphasized that talks are in the early stages, and a final agreement may not materialize. Nonetheless, with the rapidly evolving media landscape and the imperative for strategic positioning, the media industry closely monitors these developments.
Axios broke the story.
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