Warner Bros. Rejects Paramount’s $20 Per Share Offer as Undervaluation

Warner Bros. Discovery has turned down an initial takeover bid from Paramount Skydance at $20 per share, deeming the offer insufficient. Sources indicate WBD believes the proposal significantly undervalues its growth potential. The rejection comes as Paramount seeks to consolidate its position ahead of WBD’s planned corporate split next year.

Paramount Skydance, led by David Ellison, now faces limited pathways forward—either increasing its bid, courting WBD shareholders directly, or securing additional financial backing. The disparity in market capitalization between the two firms is stark: PSKY stands at $18.6 billion, while Warner Bros. commands a $42 billion valuation. Despite the potential scale of the merger, WBD’s size grants it superior negotiating leverage.

Paramount’s strategic focus centers on expanding its content pipeline to bolster competitiveness in streaming. Ellison recently emphasized at the Bloomberg Screentime conference that acquisition opportunities remain plentiful, with content volume being a critical driver of engagement.