New York Post·2025-12-09 22:33Core Viewpoint - Wall Street anticipates a bidding war for Warner Bros. Discovery (WBD), impacting the stock prices of both Paramount Skydance and Netflix, the two media giants interested in acquiring it [1]. Group 1: Bidding Strategies - Paramount Skydance is considering increasing its offer from $30 per share as part of a hostile takeover strategy, aiming to convince WBD shareholders that its all-cash bid is superior to Netflix's $27.75 per share cash-and-stock offer [2]. - WBD CEO David Zaslav indicated that if Paramount Skydance raises its offer by an additional $5 per share, it could disrupt the sale to Netflix [5]. - Traders expect Netflix to respond by raising its offer to remain competitive in the bidding war [6][8]. Group 2: Market Reactions - Following the announcement of the hostile takeover, Paramount's odds of winning increased to 45%, while Netflix's odds dropped to 35% in betting markets [11]. - Despite winning the bidding war initially, Netflix's stock fell over 6% since the announcement of Paramount's hostile bid, while Paramount's stock saw a smaller decline of 1.4% [12]. - Shares of WBD have risen nearly 17% since the announcement of the Netflix deal, trading above $28 and potentially heading above $30 if the bidding war materializes [7]. Group 3: Financial Considerations - Larry Ellison's wealth, estimated at over $270 billion, is seen as a financial advantage for Paramount Skydance, while Netflix has a market value of $441 billion [6]. - David Ellison may need to increase borrowing or find new equity partners unless his father, Larry Ellison, sells Oracle shares, which he has been reluctant to do [15][22]. - Paramount Skydance's bid is viewed as more straightforward since it seeks to acquire all of WBD, while Netflix's offer relies on the performance of its streaming service and regulatory considerations [16][18].