Warner Bros. Discovery, Inc. (NASDAQ: WBD) is trading like a company caught in a live-action script rewrite: two giant suitors, a looming tender-offer deadline, and now fresh reporting that could reshape the value of its cable-network “leftovers.”
As of the latest available quote heading into Thursday, Dec. 18, 2025, WBD shares were around $28.21. [1]
That price matters because it sits in the blast radius between:
- Netflix’s agreed cash-and-stock deal for WBD’s Streaming & Studios assets (with a separate spinoff of the linear networks), and
- Paramount Skydance’s hostile all-cash tender offer for the whole company.
And this morning’s new headline adds a third plotline: a hedge fund’s potential interest in buying or investing in WBD’s TV networks—including CNN—just as those assets are slated to be spun out.
What’s new on Dec. 18: Standard General reportedly in talks around WBD’s TV networks (including CNN)
Reuters reported early Thursday that Soo Kim’s Standard General has held talks about potentially buying or investing in WBD’s television networks, citing a Financial Times report. The same reporting says at least one major WBD shareholder approached Kim about acquiring all or part of the company’s cable assets, including CNN. [2]
Why the market cares: WBD’s planned structure already involves separating its Global Linear Networks business into “Discovery Global.” If credible buyers start circling the networks before that separation is complete, it can change investor assumptions about what the spun entity might be worth—and how much debt it can carry—without collapsing under the weight of cord-cutting.
Reuters also notes the political noise around CNN, citing past remarks from President Donald Trump that CNN “should be sold” either inside a broader transaction or separately. [3]
Whether or not politics moves the deal math, it definitely raises the “headline risk” temperature—which traders tend to price as volatility.
The core battleground: Netflix deal vs. Paramount Skydance’s hostile tender offer
Netflix’s agreed transaction: cash + stock (with a collar) plus a spinoff of Discovery Global
WBD’s board is telling shareholders, in unusually blunt language, that Netflix is the more certain path.
In its Dec. 17 recommendation, WBD says the Netflix deal offers shareholders:
- $23.25 per share in cash, plus
- $4.50 per share in Netflix stock (with a collar tied to Netflix’s stock price at closing), plus
- additional value from receiving shares in Discovery Global after the networks separation. [4]
The SEC Schedule 14D‑9 spells out the mechanics with more precision. Under the merger agreement, each WBD share converts into $23.25 cash + Netflix shares based on a 15-trading-day VWAP (measured shortly before closing), subject to a collar, and a net-debt adjustment tied to Discovery Global. [5]
Here’s the collar structure (highly relevant given today’s Netflix stock level):
- If Netflix’s average price is ≥ $119.67, the exchange ratio is fixed at 0.0376 shares of Netflix per WBD share.
- If it’s between $97.91 and $119.67, the stock value is set to about $4.50 (ratio = 4.50 / average price).
- If it’s ≤ $97.91, the exchange ratio is fixed at 0.0460, meaning the stock component value falls as Netflix stock falls. [6]
Today, Netflix is trading around $94.79, which is below the collar’s lower bound—exactly the point Paramount has been hammering. [7]
Back-of-the-envelope: at $94.79 with the 0.0460 ratio, the stock piece would be about $4.36 per WBD share (instead of $4.50), taking the headline $27.75 value down modestly—before you even get into the separate Discovery Global distribution and the debt adjustment. [8]
Paramount Skydance’s hostile offer: $30 all-cash tender—expiring Jan. 8, 2026 (unless extended)
Paramount Skydance is offering $30.00 per share in cash via a tender offer that is scheduled to expire at 5:00 p.m. New York City time on Jan. 8, 2026, unless extended. [9]
WBD’s board calls Paramount’s bid “illusory,” arguing it can be amended and that it lacks the certainty of a signed merger agreement—and that, as structured, it can’t realistically be completed by its current expiration date given regulatory timelines. [10]
Paramount disputes that characterization. In its own Dec. 17 statement, Paramount says:
- its offer is “fully financed,”
- it provides 100% cash certainty versus Netflix’s stock exposure, and
- Netflix’s offer can be reduced if Netflix trades below the collar and due to debt-linked adjustments. [11]
Paramount also lays out a financing mix it says includes $41 billion of new equity and $54 billion of debt commitments (naming Bank of America, Citi, and Apollo in that disclosure). [12]
WBD counters—forcefully—that the “full backstop” from the Ellison family is not what Paramount claims, pointing to the use of an opaque revocable trust rather than a direct unconditional equity commitment. [13]
Why WBD stock is above (or near) the Netflix headline price
If you’re wondering why WBD shares aren’t neatly pinned to $27.75, welcome to merger arbitrage—where the price is less about “intrinsic value” and more about probabilities, timelines, and legal/regulatory friction.
Three forces are doing most of the work:
- Two competing bids create optionality: markets price the chance Paramount sweetens terms or forces a renegotiation. [14]
- Netflix consideration is not a fixed $27.75 in practice because of the stock collar mechanics and the net-debt adjustment tied to Discovery Global. [15]
- Discovery Global shares add an extra moving piece: shareholders are expected to receive stock in the spun networks business (ratio to be set closer to separation), which can be worth “something” even as linear TV declines. [16]
A simple probability sketch (not a prediction, just math):
If you naïvely compare $30 cash vs. $27.75 and ignore time/value of the Discovery Global distribution, WBD at ~$28.21 implies a modest chance of the higher outcome. But because Netflix’s structure includes the separate Discovery Global distribution and Paramount’s bid has its own completion risks, the “true” implied odds are more complicated than a two-number average. [17]
The Dec. 18 twist: why Standard General interest could matter for Discovery Global’s value
Today’s Standard General headline is interesting because it points directly at the hardest part of this whole story: what is the linear networks business worth in 2026+?
WBD’s transaction structure explicitly transfers the Global Linear Networks business to a new entity (SpinCo / Discovery Global) and distributes it to WBD shareholders before the Netflix merger closes. [18]
If credible buyers show up for the networks before that distribution:
- It could put a market “check” on valuation (even if informal).
- It could help answer whether Discovery Global will be a cash-flowing “melt-ice-cube” or a forced-sale liability.
- It may affect assumptions about how much debt gets loaded into Discovery Global, which matters because the Netflix merger consideration includes a dollar-for-dollar adjustment based on Discovery Global net indebtedness. [19]
In plain English: if the networks can attract capital or a buyer at a decent valuation, it potentially reduces the scenario where the spinoff is treated as a toxic stub. Today’s Reuters report is not confirmation of a deal—but it’s enough to move the conversation from “maybe” to “someone is at least kicking the tires.” [20]
Analyst forecasts on Dec. 18: “Moderate Buy” consensus, but price targets sit below the takeover-driven price
One of the strangest things you’ll see in takeover situations is this: the stock trades at a deal premium while many analyst price targets still imply downside.
That’s happening here.
- TipRanks, in a Dec. 18 note tied to the Standard General headline, lists WBD with a Moderate Buy consensus and an average price target around $22.32, even after a big run in the stock. [21]
- MarketBeat’s Dec. 18 roundup similarly cites a consensus price target around $22.58 and notes the stock opened around $28.21. [22]
- Investing.com’s consensus page shows an average target around $25.902 (with a high estimate of $35 and low of $15). [23]
This isn’t analysts “missing something obvious” so much as analysts being trapped in two worlds:
- Stand-alone WBD fundamentals (declining linear ads, heavy debt load, streaming ramp), versus
- Event-driven deal pricing (probability-weighted outcomes and regulatory timelines).
In other words, price targets can become less of a compass and more of a historical artifact during an M&A knife fight.
Fundamentals still matter: WBD’s operating picture behind the takeover drama
Even with M&A headlines dominating, the underlying business is why WBD became a target in the first place: iconic IP + streaming scale ambitions + a legacy linear business throwing off cash (but shrinking).
In its Q3 2025 update, WBD reported:
- 128.0 million streaming subscribers, up 2.3 million vs. Q2, [24]
- Total Adjusted EBITDA of $2.5 billion (up 2% ex-FX), driven by growth in Streaming and Studios but offset by Global Linear Networks decline, [25]
- $0.7 billion free cash flow for the quarter (impacted by separation-related items), [26]
- $4.3 billion cash on hand, $34.5 billion gross debt, and 3.3x net leverage, [27]
- plus sharp pressure in legacy ad trends (WBD cited advertising revenues down 17% ex-FX, tied to domestic linear audience declines even as ad-lite streaming grew). [28]
That mix—streaming improving, studios volatile, linear sliding—is exactly why the deal structure tries to “separate the eras”: Netflix takes the growth-and-IP engine; WBD shareholders keep the linear networks in Discovery Global. [29]
Key dates and catalysts for WBD stock from here
Here are the near-term “known knowns” that traders are watching because they can force the next rewrite:
- Jan. 8, 2026 (5:00 p.m. NYC time): Paramount Skydance tender offer scheduled expiration (unless extended). [30]
- Spring / early summer 2026: Reuters reporting points to a shareholder vote window for the Netflix deal. [31]
- Q3 2026: Discovery Global separation targeted for completion (per Netflix’s SEC-filed communications). [32]
- Break fees and deal protections: WBD would owe Netflix $2.8 billion under certain superior-proposal terminations; Netflix would owe WBD $5.8 billion in certain regulatory-failure scenarios after a long-stop date structure (per WBD’s Schedule 14D‑9). [33]
And one more “soft” catalyst that keeps popping up: third-party interest in assets, like today’s Standard General/CNN reporting, which can influence both shareholder sentiment and the perceived value of the spinoff. [34]
The takeaway for Dec. 18: WBD is trading on deal probability, not just business performance
On a normal day, WBD would trade on subscriber adds, ad trends, and debt paydown. Today it’s trading on something more cinematic:
- Is Paramount’s $30 cash offer real enough to win—or at least force higher terms? [35]
- Does Netflix’s structure (and financing certainty) outweigh the collar and regulatory timeline risk? [36]
- Can the linear networks (Discovery Global) attract capital or a buyer, raising confidence in the “stub” value? [37]
If you want the simplest mental model: WBD stock is currently a market-implied vote on which deal closes, when it closes, and how much value the spinoff can carry without sinking.
References
1. ir.wbd.com, 2. www.reuters.com, 3. www.reuters.com, 4. ir.wbd.com, 5. www.sec.gov, 6. www.sec.gov, 7. www.prnewswire.com, 8. www.sec.gov, 9. www.sec.gov, 10. ir.wbd.com, 11. www.prnewswire.com, 12. www.prnewswire.com, 13. ir.wbd.com, 14. www.reuters.com, 15. www.sec.gov, 16. www.sec.gov, 17. ir.wbd.com, 18. www.sec.gov, 19. www.sec.gov, 20. www.reuters.com, 21. www.tipranks.com, 22. www.marketbeat.com, 23. www.investing.com, 24. www.wbd.com, 25. www.wbd.com, 26. www.wbd.com, 27. www.wbd.com, 28. www.wbd.com, 29. www.sec.gov, 30. www.sec.gov, 31. www.reuters.com, 32. www.sec.gov, 33. www.sec.gov, 34. www.reuters.com, 35. www.prnewswire.com, 36. www.sec.gov, 37. www.reuters.com
