What Happened?
Shares of global entertainment and media company Warner Bros. Discovery (NASDAQ: WBD) jumped 3.3% in the afternoon session after Paramount amended its takeover offer, with billionaire Larry Ellison personally guaranteeing $40.4 billion in financing for the proposed acquisition.
The move addressed concerns from Warner Bros. Discovery's board regarding the certainty of financing for Paramount's $30 per share all-cash offer. Ellison's irrevocable personal guarantee strengthened the hostile bid by removing a key point of doubt. This increased investor confidence that the deal was more likely to be completed, which sent the company's shares higher.
After the initial pop the shares cooled down to $28.73, up 2.8% from previous close.
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What Is The Market Telling Us
Warner Bros. Discovery’s shares are very volatile and have had 20 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 14 days ago when the stock gained 5.6% on the news that Paramount launched a hostile, all-cash takeover bid to acquire the company for $30.00 per share, representing a superior offer to a recent deal with Netflix.
The unsolicited offer from Paramount Skydance, valued at an enterprise level of $108.4 billion, directly challenged a prior agreement for Netflix to purchase Warner Bros. Discovery. That deal, announced just days earlier, valued the company at $27.75 per share, or about $83 billion in total. Paramount stated its proposal provided shareholders with a superior alternative and offered a more certain and quicker path to completion. The significant jump in Warner Bros. Discovery's stock price reflected investor reaction to the higher, all-cash bid.
Warner Bros. Discovery is up 169% since the beginning of the year, and at $28.73 per share, it is trading close to its 52-week high of $29.98 from December 2025. Investors who bought $1,000 worth of Warner Bros. Discovery’s shares 5 years ago would now be looking at an investment worth $1,056.
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