For those wagering against Comcast in the bidding war for Warner Bros. Discovery, the cable giant’s CEO Brian Roberts is signaling that he will see their bets – and that he may raise them, too.
People with direct knowledge say that Roberts – scrambling to reinvigorate Comcast’s shrinking empire – plans to join a second round of bidding next week for WBD, which owns the No. 1 Hollywood studio, the No. 3 streamer in HBO Max plus cable properties like HBO and CNN.
Roberts is even weighing a potential offer that could catapult him ahead of his rivals – a bid that could possibly reach a valuation of $27 or $28 a share, according to the sources. And that’s just for its studio and streaming businesses.
To be sure, Roberts and his team have not, as of press time, come up with a final number, these people say. But if they bid to those levels, it would be a respectable premium to the roughly $25 a share already placed by Paramount Skydance for the entire company – an offer worth about $60 billion. It would also likely surpass the first-round bid made by Netflix, which is also vying for the studio and streaming pieces of WBD, according to people with knowledge of the matter.
One thing is certain: Roberts knows he needs to play hardball to win, these sources say. He’s making a run at WBD despite extreme reluctance from the Trump administration to approve anything Roberts touches given his long stewardship of the Trump-hating cable channel MS NOW.
Plus, he is said to believe he has no choice given Comcast’s challenges: a laggard streaming service in Peacock, a second-place network in NBC, and a smallish studio on top of lots of debt as he spins off MS NOW and other cable channels into a new company. He has cable pipes but that’s seen as a declining business.
Rich Greenfield, the widely followed “ax” of media analysts at LightShed Partners, believes Comcast needs to fight hard for WBD or face being run over by bigger media and tech players. “Can you imagine what happens if Comcast loses, what happens to Peacock?” he tells On The Money. “They will be the only ones on the dance floor with no obvious partner.”
The thinking is that with a leading bid Roberts might be able to get the greenlight from the WBD board for a bid and then successfully challenge in federal court any rebuttal from the Trump DOJ antitrust department, arguing that in the age of multiple streaming services, content being offered on YouTube and social media, no significant antitrust issues exist with his offer.
A Comcast spokesman declined to comment.
As The Post has reported, Netflix has launched its own charm offensive to prove that its bid faces less regulatory scrutiny. Some members of the WBD board are warming to the Netflix offer after hearing arguments from Netflix legal staff that normal antitrust concerns would not apply to the combination of its No. 1 streamer in the world, with WBD’s No. 3.
That’s because of something known as “category ambiguity.” It’s impossible to corner the streaming market through such combinations because of the reach of YouTube and social media. The Netflix bid allows WBD to spin off its cable assets as was previously planned, which is seen as another positive for its offer.
Reps for Netflix and DOJ antitrust had no immediate comment.
One problem for WBD in valuing the bids is that Comcast only wants its streaming service and studio; thus, its overall value is derived from how much he’s offering for those two units so it’s not quite an apple-to-apple comparison with the money being put up by Paramount Skydance. Roberts will also have to borrow or seek equity partners to finance his offer given Comcast’s relatively modest balance sheet.
Another complicating factor is political opposition from Trump, who is said to be adamantly opposed to making Comcast stronger. Roberts could read the room and change his mind in the coming days as the second-round bidding deadline of Dec. 1 approaches, people close to him tell me.
That’s because to stay the course he will have to play the long game, and convince the WBD board to do the same through a two-year process that includes a lengthy probe by the Trump-appointed DOJ antitrust chief Gale Slater, and then lawsuit in federal court where a win isn’t a given.
The WBD board and CEO David Zaslav also might decide they don’t want to roll the dice with its bid for chunks of the company when it can simply sell everything to Paramount Skydance, run by David Ellison and his father, the Trump supporting mega-billionaire Larry Ellison.
They will receive a far easier ride through the regulatory apparatus with Slater in their effort to buy the entire company, according to media executives with direct knowledge of the agency’s thinking.
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