Warner Brothers Spinoff Plan Under Threat
WBD had earlier committed to dividing itself into two publicly traded companies by mid-2026. One focused on Streaming & Studios (HBO, film production, DC, streaming platforms), the other on Global Networks (CNN, TNT, linear cable channels etc.). This split was announced in June and detailed in our July 31 article “Breaking Up Better: Warner Brothers Discovery Plans Mid-2026 Spinoff.”
Under the spinoff plan, shareholders would receive shares in both new companies in a pro-rata tax-free spinoff with a goal of allowing WBD to separate its high-growth studio/streaming business from its cash-flow heavy but debt-burdened linear networks.
But now, with Paramount Skydance, backed by the world’s new richest man, reportedly preparing to bid, the entire structure could shift. A full acquisition would likely block the spin altogether
Paramount & Warner Brothers Discovery: Spinoff Veterans
Paramount’s own story makes this potential move especially interesting. Paramount Global(which recently merged with Skydance) was built from previous spinoffs: the Viacom/CBS split (and later merge) is a textbook example. Paramount, after spinning off CBS, later merged again, effectively reversing its own spin. This gives them some historical context for what a spin and re-merge can do.
Warner Brothers Discovery likewise has many spinoffs in its past, including the reverse mosrris trust transaction with AT&T(T) that formed it just a few years back.
Regulatory Risk Could Derail A Paramount Skydance Bid For WBD
Major media mergers have long been a tough sell. AT&T had to go to court to buy Warner Brothers, a move it came to regret and undid a few short years later. But the Ellison family brings both massive wealth and strong connections to the Trump administration with them and may thus be able to get a deal done. Merging Paramount+ and HBO Max might give David Ellison the scale to compete with Netflix and Disney+. We might even some assets spun off in order to get a deal done. The days and weeks ahead should be interesting indeed.
Disclosure: The author holds no shares in any stock mentioned