Warner Bros. Discovery Asks for 3rd Round of Bids Due Today

The bidding war for Warner Bros. Discovery continues to escalate, with the company’s board asking for another round of bids due Thursday, according to multiple media reports. This now marks the third round of bids to involve Paramount, Comcast and Netflix.

The move comes after the three entertainment giants submitted a second round of bids for all or part of the company on Dec. 1. WBD asked for improved offers following a first round of bids that were submitted on Nov. 20. The auction is expected to conclude at the end of the month, which aligns with the previously reported timeline.

Representatives for Warner Bros. Discovery did not immediately respond to TheWrap’s request for comment.

In addition to continuing on with its planned split into Warner Bros. and Discovery Global, which is on track for completion in April, the company’s board is considering separate transactions for the two companies or a deal for the entire combined company. WBD said it would also consider an alternative separation structure that would enable a merger of Warner Bros. and spinoff of Discovery Global to its shareholders.

Paramount has submitted multiple bids for all of WBD,  including three which were rejected for being too low. Its latest bid is an all-cash offer primarily backed by the Ellisons, which also includes contributions from three Middle Eastern sovereign wealth funds and debt financing from Apollo Global Management.

TheWrap previously reported that Paramount was in talks with Saudi Arabia’s Public Investment Fund (PIF), the Qatar Investment Authority (QIA) and the Abu Dhabi Investment Authority (ADIA) about investing in its bid despite the media giant’s previous public denials.

The involvement of foreign investors in the latest bid could require approval from the Committee on Foreign Investment in the United States (CFIUS) if they were to obtain 25% or more voting interest in a U.S. company and a foreign government holds a 49% or greater voting interest in that foreign investor.

The Ellisons are expected to maintain majority ownership in a combined company and foreign investors’ involvement is not expected to reach the level that would trigger a regulatory review, a person familiar with the bid told TheWrap.

In addition, the company has raised its proposed breakup fee for a bid from $2.1 billion to $5 billion.

Meanwhile, Netflix and Comcast have submitted bids for the company’s studio and streaming business. Specific financial terms of those bids could not be immediately learned, though Netflix’s latest offer is a majority cash bid.

Comcast’s bid would look to merge Warner Bros.’ streaming and studio business with NBCUniversal in a deal that would be a combination of cash and stock. It has also offered WBD CEO David Zaslav a management role at the combined company.

In a recent letter, Paramount accused WBD of orchestrating an unfair bidding process that favors Netflix. Warner’s lawyers responded to the letter in a response obtained by TheWrap, assuring Paramount that its board “attends to its fiduciary obligations with the utmost care, and that they have fully and robustly complied with them and will continue to do so.”

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