The prospect of a sale for Warner Bros. Discovery (WBD) is fully underway, with three significant entities actively formulating offers. David Ellison's Paramount Skydance, Netflix, and Comcast are the primary contenders, all eyeing various aspects of the media giant. A critical deadline of November 20 has been established for the submission of initial, non-binding bids, as confirmed by sources to Variety, aligning with an earlier report from the Wall Street Journal.

Amidst the bidding frenzy, Paramount Skydance recently refuted a Variety report suggesting it was forming an investment consortium with Saudi Arabia, Qatar, and Abu Dhabi's sovereign wealth funds to submit a bid for Warner Bros. Discovery. A representative for Paramount Skydance categorically denied the information, stating, "The information Variety published is categorically inaccurate." The company emphasized the confidentiality of the process and declined further comment until its conclusion. Variety's earlier report, citing anonymous sources, claimed the Ellison family intended to put together a $71 billion bid with the involvement of Saudi Arabia’s Public Investment Fund (PIF), the Qatar Investment Authority (QIA), and the Abu Dhabi Investment Authority (ADIA).

Warner Bros. Discovery's board, having previously rejected a $23.50 per share offer from David Ellison, is slated to convene before Thanksgiving to evaluate the incoming offers, with the aim of finalizing the process by year-end. An alternative path for WBD involves a potential split into two distinct entities: one led by David Zaslav, overseeing Warner Bros. (including HBO Max and studios), and the other headed by current CFO Gunnar Wiedenfels, focusing on the TV-centric Discovery Global. Zaslav's hypothesis posits that a separated Warner Bros., detached from the lagging TV business, would command a higher valuation than its current integration within WBD, with estimates suggesting a stand-alone Warner Bros. could have an enterprise value of $44 billion and an equity value of $37 billion.

Each potential bidder brings a unique strategy and set of challenges. David Ellison, through Paramount Skydance, argues that a merger with WBD would create a formidable, scaled-up powerhouse, positioning it as a stronger competitor against industry giants like Disney and Netflix. He also highlights potential regulatory hurdles for Netflix and Comcast. Despite his strong motivation, Ellison has signaled a measured approach, telling investors there is "no must-have" for Paramount Skydance, viewing it as a "buy-versus-build" decision. The Ellison family, particularly Larry Ellison, is fully backing the bid, with additional participation from RedBird Capital. Regarding antitrust concerns for consolidating two major studios, the Ellison camp suggests such a union would foster greater competition in the market.

Netflix, a company historically leaning towards building rather than acquiring, sees the opportunity to acquire Warner Bros.' deep film and TV library, extensive production capabilities, and HBO Max as too significant to ignore. With a market capitalization exceeding $470 billion and $9.3 billion in cash, Netflix possesses the financial means for a credible, likely all-stock, bid. However, the streamer is not in a "spend-at-all-costs" mode, demonstrated by its decision to pass on outbidding Ellison for UFC rights. Antitrust concerns are a significant factor for Netflix, with Rep. Darrell Issa explicitly raising questions about Netflix's already "unequaled market power" in a letter to Trump officials. Furthermore, Netflix would need to reconcile Warner Bros.' theatrical slate with its own historically anti-theatrical stance.

Comcast, undergoing its own corporate split as its Versant cable TV vehicle prepares to separate from NBCUniversal, also sees substantial synergy opportunities. Co-CEOs Brian Roberts and Mike Cavanagh envision combining HBO Max with Peacock and integrating Warner Bros. studios into Universal. Unlike Ellison, Comcast is not interested in acquiring WBD's cable networks such as CNN, TNT, HGTV, and Food Network. A notable challenge for Comcast is its stock trading near a 14-year low, which could hinder its competitiveness against Netflix's robust stock and Larry Ellison's considerable wealth. Roberts was reportedly scouting for outside investors to bolster Comcast's bid. The "Donald Trump factor" also looms, as the former president's public scorn for Roberts over MSNBC's coverage could potentially jeopardize Comcast's prospects.

Amidst these intricate dynamics, other scenarios are being considered, such as a complex deal where Netflix acquires the Warner Bros. studios (potentially led by David Zaslav) and Comcast purchases HBO Max. However, such a fragmented acquisition would present significant logistical and regulatory challenges. Ultimately, industry insiders suggest that David Zaslav's ambition for the "biggest crown" and the company's board might be leveraging the competing bids to inflate the sale price, ensuring the maximum windfall for shareholders.