Warner Bros. Discovery Is in Talks to Merge With Paramount: Is Its Stock a Buy for 2024?
On Dec. 20, Axios reported that Warner Bros. Discovery (NASDAQ: WBD) was in talks to potentially merge with Paramount Global (NASDAQ: PARA). The news wasn't positively received by investors, with both stocks dipping between 5% and 8%, respectively, in the days following.
Paramount has been under intense pressure to find a partner or buyer as it faces significant debt. Meanwhile, since WarnerMedia and Discovery came together in 2022, its key objective has been to pay down the considerable debt it accrued from merging. Combining Warner Bros. Discovery and Paramount would therefore create a company that would start out substantially in the red.
However, a merger wouldn't be all bad news over the long term. The last two years have seen Warner Bros. Discovery become an expert at paying down large sums of debt, suggesting it might be up to the task if it were to take on Paramount. Meanwhile, the addition of Paramount's assets could make the company a formidable opponent in television, film, news, and sports against industry giants like Disney.
Source Fool.com
