Comcast CEO confident in winning bidding war for – Business News
The people at Comcast are saying “We got this in the bag.” Most of Wall Street isn’t so sure.
The phrase coming from the cable giant is that it has the money that Warner Bros. Discovery CEO David Zaslav desires – and that it’ll scoop up no less than elements of the media conglomerate it’s most in: its HBO Max streaming service and its top-ranked Hollywood studio.
But the passion from Comcast CEO Brian Roberts and his bankers at Goldman Sachs and Morgan Stanley is drawing skepticism on Wall Street and in Hollywood, which have been captivated by the bidding war for one of media’s most prize possessions. Final bids for the company are scheduled to be delivered later this week.
Comcast CEO Brian Roberts has the money to win a bidding war for Warner Bros. Discovery belongings — no less than that’s what the phrase is — however large bankers on Wall Street see issues — particularly regulatory ones. Donald Pearsall/NY Post Design
A mix of money points and regulatory hurdles makes Comcast a darkish horse to finish the deal even when it might probably come up with a winning bid, the skeptics inform On The Money.
“Comcast’s problem is their stock is trading low and their leverage high, but their biggest problem is regulatory,” stated an antitrust lawyer concerned in the deal. “It will be more than a two-year process and still fail.”
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A Comcast spokesman had no remark however a senior individual on the firm says it’s as properly positioned as anybody to make a run for the company.
“We have plenty of growth opportunities in our six growth drivers, and we are investing in those,” this individual stated. “We have the best balance sheet and credit rating in our industry. We have an obligation to look at things so we do that.”
It will definitely need all of that and more. Warner Bros Discovery, aka WBD, homes a film hit machine studio, the No. 3 largest streamer in HBO Max, and large time cable properties like HBO and CNN. A deal might run as high as $70 billion.
A deal for David Zaslav’s Warner Bros. Discovery might run as high as $70 billion. WireImage
Even so, Roberts, with Goldman Sachs and Morgan Stanley at his facet, is claimed to be lusting to mix WBD with Comcast, a media company that’s breaking off its lefty cable community, MSNBC and financial information outlet CNBC into a separate company whereas leaving Roberts to handle a middling studio, rankings challenged NBC and a few broadband and cable pipes.
What’s unclear is how he pays for a deal that can price many tens of billions of {dollars} relying on how a lot of WBD he bids on. Comcast has a weak money place—simply $9 billion. It has an A-minus bond ranking that might simply be destabilized with a massive borrowing to finance the deal because it has practically $100 billion in debt.
Its stock price has cratered over the previous 12 months amid investor business-model issues. It’s down 36% in comparison with a practically 6% decline in arch rival Disney and a 14% spike in the S&P.
Comcast’s stock price has cratered over the previous 12 months amid investor business-model issues. REUTERS
Roberts’ entry to money has been in query no less than in Wall Street and media circles; he was not too long ago noticed in Saudi Arabia, assembly with officers from its huge public investment fund for financing, Wall Street executives say. Bringing in a international proprietor for a main US media asset could possibly be an concern in getting regulatory approval for any deal.
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In the top Roberts may get the money (Goldman and Morgan will be persuasive) however money gained’t buy you’re keen on from President Trump, whose regulatory equipment, particularly the DOJ antitrust division, is needed to OK any transaction.
Let’s simply say Trump isn’t a fan of the CEO who runs the Trump-hating MSNBC, and “Saturday Night Live,” which mocks the president on a weakly foundation far more harshly than it did former President Biden, regardless of Sleepy Joe’s lack of mental acuity whereas in workplace.
Meanwhile, Trump, as The Post has beforehand first reported, would really like his buddies at Paramount Skydance to emerge victorious in the WBD bake-off, which has additionally attracted curiosity in streaming giant Netflix, the streaming giant that’s stated to be offering cost in stock.
The president has all however assured the inexperienced gentle for Paramount Skydance’s practically $60 billion all-cash bid for your complete WBD. It can be run by unbiased film producer David Ellison, the son of Oracle co-founder Larry Ellison, the billionaire Trump donor.
