Warner Bros. Discovery Shares Pick Strong Rally As Larry Ellison-Backed Company Considers Bid

Shares of Warner Bros. Discovery rallied as much as 29% on Thursday's trade to close at $16.17, amid reports of Paramount Skydance, backed by family of Oracle's Larry Ellison, launching a bid to acquire the company.

Warner Bros' shares have risen a further 9% in the aftermarket as optimism grew around the merger of two of the biggest media conglomerates in the United States. Paramount Skydance shares were also up 9.1%.

This comes on the back of a report from the Wall Street Journal, which suggests Paramount is considering a majority cash-bid for Warner Bros. Discovery.

The bid will be made for the entire company, including its cable network and movie studios, the report stated.

It must be noted that Warner Bros. Discovery has a market capitalisation of $33 billion, almost double that of Paramount ($17 billion).

A potential acquisition could lead to the marriage of two of Hollywood's biggest studios.

Warner Bros. Discovery is the studio behind Harry Potter, The Lord of the Rings and DC Comics. It has also produced shows like The White Lotus and Peacemaker, among others. WB also owns cable networks CNN, TNT and TBS.

Paramount, meanwhile, has produced films such as Interstellar, Mission Impossible series and the Godfather series.

It must be noted that Skydance, a company run by David Ellison, the son of billionaire Larry Ellison, completed its merger with Paramount weeks ago. The company is now looking at the possibility of another merger.

Larry Ellison was one of the most talked-about personalities in social media this week as he briefly became the world's richest person, ahead of Elon Musk.

The Wall Street report adds that a potential deal between the two is likely to bring in antitrust and regulatory scrutiny. However, it added that a bid has not been submitted, and things could still fall apart.