On today’s episode of “Daily Variety” podcast, Erik Gordon, a professor at the University of Michigan’s Ross School of Business, breaks down the Warner Bros. Discovery sale saga as the company’s shareholders prepare to vote on the sale to Paramount Skydance.
Gordon, who studies mergers and acquisitions and has used Warner Bros. Discovery as a case study in one of his classes, says that the process has been “unusual” for both WBD and Paramount Skydance. WBD shareholders will get the chance to vote April 23 on whether to support the deal. It’s been a long road for the company since sale rumors picked up steam last summer. WBD at first tried to hold off its aggressive suitor, which was one of many unconventional aspects of the transaction.
“It’s unusual for the target to just say, ‘We’re not going to talk to you, take a hike. We don’t want to listen.’ It’s sort of like, putting their hands over their ears and going, nah, nah, nah, nah, nah, nah. That’s pretty unusual,” Gordon says. “It finally got to the point where some legal duties took over. It’s also unusual for the pursuer, the acquirer Paramount Skydance, to be so persistent. I mean, you’ve got to give David Ellison credit for. He’s the guy who gets turned down by a girl 23 times. And he asks the 24th time and she says, ‘OK, I’ll go out with you.’ ”
The jockeying around WBD, the tug of war between Netflix and Paramount Skydance over the deal reflects so many crosscurrents that are roiling the traditional entertainment business. But fundamentally, a company endowed with sui generis assets such as Warner Bros. and HBO offers a rare opportunity to grab significant showbiz real estate.
“This deal, even though it didn’t create the big changes in the industry, this deal will probably come to symbolize all of those big changes,” Gordon says.
Listen to Daily Variety on iHeartPodcasts, Apple Podcasts, Variety’s YouTube Podcast channel, Amazon Music, Spotify and other podcast platforms.
Leave a Reply