David Zaslav has just wrapped up a monumental media merger, but his work isn’t quite finished yet.
The clever CEO of Warner Bros. Discovery managed to sell the massive media entity for an impressive $72 billion, effectively more than doubling its worth in a matter of months. Some say there’s still potential for him to secure an even better deal, marking a significant turnaround story in the management world lately.
However, the path forward for WBD remains a bit shaky. To understand that, we should revisit the intense bidding war Zaslav navigated, one that pitched some major media players against each other and escalated the selling price to unexpected heights.
When the bidding started in September, WBD shares were trading around $12, slightly above a concerning low of $7.50 from the previous year. That’s when Paramount Skydance, probably seeing what others missed, pitched a compelling offer of $23.50 per share—roughly $56 billion—for WBD, which included its studios, the HBO Max streaming service, and well-known cable channels like CNN and HBO.
It looked like a done deal. The wealthy Ellison brothers, David and Larry, were ready to pay cash to WBD shareholders in exchange for these unstable assets. They even dangled the idea of easing deregulation under the Trump administration, since Larry Ellison had a close relationship with the president.
But things weren’t that straightforward. Zaslav, mentored by some of the most renowned CEOs, like Jack Welch and John Malone, has his eyes set on becoming the CEO of the newly formed Warner Bros. Discovery, which emerged following Warner Media’s spinoff from AT&T in 2022 under Malone’s guidance.
Addressing Financial Realities
Warner’s portfolio was not in great shape—loss-making studios, unprofitable streaming services, and traditional media channels like HBO, CNN, Tito, and the Food Network constituted its assets. Zaslav found himself in deep debt yet continued to extract shareholder value while paying himself hefty sums.
What many in the market overlooked was Zaslav’s ability to trim down an inflated operation and revitalize Warner Studios, with revenues climbing past $4 billion for the first time in 2025. He also developed a streaming service that eventually settled on the HBO Max brand, currently ranked third in the industry.
David Ellison saw this potential early on, even amid challenges in acquiring Paramount from the hesitant Redstone family while navigating the Trump administration’s intricate regulatory landscape.
His strategy involved merging CBS with CNN, rescuing Paramount’s fragile streaming service through HBO Max, enhancing Paramount’s studios with Warner’s resources, and obtaining significant intellectual property from some of the most iconic shows, such as “The Sopranos,” “Harry Potter,” and “Game of Thrones.”
A significant bidding war kicked off three months ago, coinciding with the Ellison brothers’ initial offer for WBD. As was reported, Mr. Szasz began courting Amazon, Apple, and others to potentially sell parts of his company. Ultimately, a bidding contest emerged between Comcast, Paramount Skydance, and Netflix. It became common knowledge that Mr. Szasz set a target of $30 per share, which was initially met with skepticism from the trading crowd, questioning who would pay such a price for shares that had been valued at merely $7 just months prior.
Examining Overconfidence
As we noted earlier, the Trump administration was inclined to keep WBD within the Ellison family, who appeared confident they could outbid others. With Larry Ellison being a close associate of Trump and a long-time MAGA supporter, the deal seemed appealing due to its clarity with minimal overlap that could raise antitrust issues.
Interest continued to surge, particularly from Netflix’s Ted Sarandos, who found Zaslav’s pitch compelling as he sought to enhance his streaming empire with a high-quality studio capable of generating original content. Sarandos, eager for a deal, even reached out directly to Trump, forming a bond with Zaslav in hopes of navigating any regulatory hurdles more smoothly. Meanwhile, Comcast kept pushing forward, with its leader, Brian Roberts, keen to smooth over tensions with Trump, especially given his association with the non-MAGA MS NOW network, through a generous gesture to build a new White House ballroom.
The Ellisons have marked their stock at $30 per share, and finally, Netflix agreed on $30.75.
The Ellisons, known for their tenacity, are not keen on conceding defeat. They might escalate their bids or pursue a more aggressive approach, arguing that an all-cash offer holds more value than Netflix’s combination of cash and stock, even if it falls just 75 cents above their bid.
So, what does this mean for shareholder value?
