Warner Bros. Discovery rejected Paramount Skydance bid at $20 a share

Warner Bros. Discovery has rejected an initial takeover bid from Paramount Skydance, turning down an offer of roughly $20 per share that the company said undervalued its business, people familiar with the matter said. The decision, made in recent weeks, leaves Paramount with multiple options to pursue an acquisition, including raising its bid, appealing directly to shareholders, or securing outside financing.

Paramount’s interest in Warner Bros. Discovery accelerated after its recent merger with Skydance, a transaction that positioned David Ellison at the combined company’s helm and drew financial backing from members of the Ellison family. The initial proposal reportedly sought to acquire Warner Bros. Discovery in full, although details remain incomplete. It is unclear whether the bid would have assumed Warner Bros. Discovery’s roughly $35.6 billion in total debt. Warner Bros. Discovery’s market capitalization has been reported near $42.3 billion, and its shares closed at about $17.10 on the most recent trading day cited in reports.

Company representatives for both Paramount Skydance and Warner Bros. Discovery did not comment on the matter. People briefed on the discussions...