Paramount Skydance is preparing a bid for Warner Bros Discovery, sources say

Paramount Skydance We are working with investment banks to prepare an offer Warner Bros Discoveryaccording to people familiar with the issue.

Warner Bros Discovery had not yet received the offer as of Thursday. Those familiar with the issue spoke about the terms of anonymity to discuss private transactions. CNBC’s David Faber reported on Thursday that he could potentially come with a bid for next week.

Warner Bros Discovery shares closed at $16.15, or more than 28% on Thursday. This is the best day ever. The company’s shares rose after initial report from the recently merged The Wall Street Journal Paramount Skydance I had prepared a purchase income card.

Representatives of Paramount and Warner Bros. Discovery declined to comment.

Paramount Skydance shares concluded at about 15%.

Warner Bros Discovery recently announced plans to separate its global TV network business from its streaming business and studios. The Journal reported on Thursday that Paramount Skydance’s bid will be an all-cash offer for WBD.

Earlier this week, WBD CEO David Zaslav told an investor meeting that the planned separation is likely to be completed by April. The streaming and studio assets have been renamed Warner Bros., and the global television network business, which owns a series of paid TV networks, including TNT and CNN, will become Discovery Global.

WBD executives said in June that each company would “become free and clear” to make transactions after the split, but that the separation must be the whole company, one of the people said.

The media industry has been navigating transformation as streaming overturns the long-time cash cow of television and entertainment companies, Pay TV Bundle.

The merger of Paramount Skydance and Warner Bros. Discovery create a media giant with a vast portfolio of pay television networks, a vast range of sports rights and two major film studios.

Paramount Skydance not only pays for television networks such as BET, MTV, Nickelodeon, and Streaming Service Paramount+, but also owns the broadcast network CBS. The film studio is known for films such as The Godfather, Top Gun, and Forest Gump.

With the exception of broadcast TV networks, WBD has similar assets. This is the result of the 2022 merger between Warnermedia and Discovery. The company owns networks such as CNN and TNT, as well as HBO and streaming service HBO MAX. Warner Bros. Film Studios also has a historic track record and owns intellectual property in franchises such as Harry Potter, DC Comics, and Lord of the Rings.

The companies also have a long list of major sports rights, which are marquee content for all traditional television and streaming platforms. The merger will put NFL, MLB, college football and basketball arrangements, and other major sports under one roof.

Media executives and experts expect integration could come into the industry.

Zaslav has publicly said for some time that media companies need to consolidate. During the November call to earnings shortly after Donald Trump was elected president, Zaslav said the new administration could lead more deals.

However, in recent months, some media companies have moved towards separation. The end of last year Comcast NBCuniversal has announced that it will spin off its pay-TV networks, including CNBC and MSNBC, into another public entity. A few months later, WBD announced that it would do the same thing.

Paramount Skydance was the result of a $8 billion merger announced last year, and received regulatory approval in August to move forward after a long delay.

The Federal Communications Commission cleared the path to the merger after Paramount agreed to pay Trump $16 million to resolve a lawsuit over compiling a “60-minute” interview with former Vice President Kamala Harris of CBS.

At the time of Deal’s approval, FCC Chairman Brendan Carr said in a statement that he welcomed “Skydance’s commitment to making major changes to the once flashy CBS broadcasting network.”

The company is aiming to cut costs by more than $2 billion, and layoffs are expected to continue. Last week, Paramount Skydance sent a note to its employees saying it is expected to seek a new year five days a week, or an acquisition.

There have been many changes since the merger backed by Redbird Capital Partners. The company has made many transactions under the leadership of David Ellison. Oracle Founder and a large sum of Larry Ellison; TKO Group’UFC for seven years starting in 2026.

On Wednesday, Larry Ellison was richer than $100 billion after software company Oracle issued growth forecasts that dramatically lifted the company’s shares.

Disclosure: Comcast is the parent company of NBCuniversal and CNBC.