Paramount Skydance has the inside track to acquire Warner Bros. Discovery, according to well-placed media executives — and it’s all about a cable network that has a troubled relationship with Donald Trump.
As first reported by The Post, the battle for control of WBD officially kicked off on Thursday at noon, as Paramount Skydance, Comcast and Netflix submitted bids for WBD, which owns the No. 1 Hollywood studio and the No. 3 streaming service in addition to HBO and CNN.
In a twist that is in some respects surprising, it is CNN that is seen as key to giving Paramount Skydance a leg up on other bidders, I am told.
That’s because PSKY’s owners — tech titan Larry Ellison and his Hollywood mogul son, David Ellison — appear to be the only bidders that so far are interested in buying the WBD cable-news subsidiary as part of the deal.
They see CNN, warts and all, as a very profitable business worth saving.
Trump, meanwhile, desperately wants CNN — whose correspondents regularly spar with him at the White House and on Air Force One — “neutralized” out of its anti-MAGA coverage, one top broadcast executive recently told.
And in his thinking, Larry Ellison, the billionaire Trump donor who is co-founder of software giant Oracle, is the perfect vehicle to set CNN straight.
Specifically, Trump wants the Ellisons to do to CNN what they are doing with their CBS subsidiary after hiring Bari Weiss, the right-of-center columnist who is under orders to squeeze left-wing bias out of its news programming.
If Paramount Skydance wins the bidding battle, Weiss’s portfolio is expected to expand to also include oversight of CNN’s editorial, according to sources.
‘White-glove treatment’
Given all of the above, the Ellisons’ bid is seen gliding through the Trump regulatory gauntlet.
Meanwhile, Brian Roberts’ Comcast and streaming giant Netflix are poised to get the mother-of-all regulatory reviews.
“The Ellisons will get the white-glove treatment and an easy 6 months before approval,” one telecom lawyer who served in government told me.
“Brian Roberts gets a proctology exam that could last two years. Same with Netflix. The Warner board might just say it’s not worth the wait.”
The Ellisons, it should be underscored, aren’t looking to take control of CNN just to make nice with The Donald.
Sources at the company say they actually like CNN’s business despite the broad decline in linear TV viewership and its lowish ratings particularly compared to my employer, Fox News.
People at Paramount Skydance point to CNN’s global news reach with reporters in just about every country.
It’s in every airport, it seems, and every hotel.
They believe the network — which still churns out an estimated $500 million in yearly profits — can be made more profitable by combining it with CBS’s news infrastructure and continuing its migration to digital platforms away from traditional cable.
Larry Ellison can easily afford to make that happen.
Since The Post first broke the news of a looming WBD auction back in September, its CEO, David Zaslav, a shrewd media dealmaker, has said he wants a deal that “starts with a 3” — namely a deal valued at $30 a share, or $70 billion.
He only gets that with a real-live bidding war, and media insiders are increasingly dubious.
First, neither Comcast nor Netflix will likely shell out that much because they are only bidding for chunks of WBD as opposed to the whole company.
In selling pieces of the company, WBD could be hit with a tax bill known as tax leakage that is common in such M&A transactions, depressing its valuation.
Regulatory pressure
Then there’s the regulatory mountain which both Comcast and Netflix have to climb — and which Paramount doesn’t.
Brian Roberts is set to spin off his Trump-hating cable channel, MSNBC, nullifying some of the antitrust issues on media consolidation.
But Trump isn’t about to forgive him for years of abuse at the hands of Rachel Maddow & Co.
Accordingly, the thinking among lawyers who work on such deals is that if Comcast wins the bidding war, his antitrust chief Gail Slater will sue to stop the deal, focusing a lengthy probe on the fact that Comcast will be merging its Universal Studios with Warner Bros.
Roberts can go to court to plead his case — and it’s worth noting that the government has a horrible record on such lawsuits.
Still, we’re talking nearly two years of legal wrangling that the WBD board might think isn’t worth the trouble.
Netflix faces similar hurdles because it would combine its No. 1 streaming service with WBD’s No. 3.
And let’s not forget its political baggage.
While Roberts has the MSNBC albatross, Netflix is run by Reed Hastings and Ted Sarandos, who have spent years supporting progressive causes from the Left Coast.
That’s why the Ellisons believe they can get away with paying no more than $27 a share for WBD — significantly below Zas’ $30 a share bogey.
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