It’s honestly more fiscal for WB to force PSKY to terminate the merger. WB could use the $7 billion in breakup fees to eat a huge chunk of their debt. Split from Discovery as planned and let them take a majority of their debt. WB does not need to merge but the hostile bidding really made it worse.
Could still easily use that $7B breakup fee to pay down their debt load and no split happening.
Zaslav can just fold Discovery+ into HBO Max once most of the international expansion is finished, just to bring down the streaming operation costs.
He's been able to whittle down a lot of debt over the past few years so it's not impossible for him to continue paying it down all the way to zero.
@Moe Gerry Cardinale's own words about the Ellisons here just gives the vibes that it would technically be a better place if Skydance, Annapurna, & Redbird would disappear completely because the average person wouldn't really miss them:
"The veal and swordfish arrive. Before we dig in, I raise another of Cardinale’s traits: his habit of partnering with the rich and famous. The list is long: Matt Damon and Ben Affleck via Artists Equity movie production; LeBron James’s SpringHill media company; Dwayne “The Rock” Johnson on a new spring football league; and David Ellison, whom he helped build Skydance and then acquire Paramount and Warner.
He says his partners are world class at what they do; RedBird brings financial acumen. “I don’t buy a Hollywood studio to go to the Oscars. I don’t buy a football team so I can go hang out in the locker room.”
We are three hours in. Much has been said about the Warner deal — the biggest leveraged buyout in history, backed by the Ellison family and Middle Eastern sovereign wealth. Having covered three Warner sales in a decade, I struggle to see why this one will be different.
Cardinale disagrees: the Ellisons bring enterprise software and AI knowhow to rewire Hollywood; RedBird brings the financial engineering to manage the debt. Unlike old owners AOL, AT&T and Discovery, he says, “we’re putting our money where our mouth is”.
Some critics have argued that David Ellison is being given a huge toy to play with by his rich dad. Cardinale bristles: “That completely misses the point. Yes, his family is wealthy. But the point is what he’s doing with it. David, in my view, is the future of Hollywood. He’s in his early forties, groomed in Silicon Valley, mentored by Steve Jobs.”
Two raspberry tartlets arrive followed by two espressos. Cardinale reminds the waiter: “Don’t forget the grappa.” I point out that the industries he’s invested in are some of the ones most affected by AI and changing consumer taste, including news, given Paramount controls CBS, 60 Minutes and soon CNN, which comes with Warner. Does he have a thing for declining industries?
He takes a sip of grappa and sets aside the dessert — he wants to stay in shape. “People ask whether I have a death wish,” he jokes.
His old Harvard classmate Ken Griffin, founder of Citadel Securities, told him he couldn’t imagine working in such stressful arenas.
Cardinale agrees he has a taste for tricky situations and never taking no for an answer — a disposition shaped by his trial-attorney father. “Every night we would have three- or four-hour dinners and he would basically put me on the witness stand and grill the shit out of me about everything — school, life, peer pressure, what was going on in the world.”"
But yeah, in order for any of that to happen at all, the U.S.'s new regional war would have to make sure the Middle East wealth funds withdrew all their money from their overseas investments (including the U.S. ones) and having Oracle stock plummeting very dramatically after being dragged financially painful by the AI bubble popping.
nypost.com
www.accruedint.com
