00:00Bloomberg's Michelle Davis on the latest in this new bidding round which was obviously Monday but we're now learning the details of the Comcast bid and it's very very interesting not least for the fact that it gives David Zaslav a role which I'm sure is very attractive to him.
00:13Yes that was one of the big outstanding questions was you know we obviously knew Comcast was interested in Warner Brothers but we didn't know exactly how a deal would be structured and what we reported yesterday is that one thing that's under consideration is combining NBCU which is Comcast you know studios streaming business with Warner Brothers is similar business and then a way to make this appealing to Warner Brothers would be to they've offered David Zaslav the CEO a role in the new combined company.
00:38The proposal also includes cash and stock for shareholders and so now and they also Warner Brothers or excuse me Comcast similar to Netflix only wants the streaming and studios of Warner Brothers and so now Warner Brothers board is going to have to decide there they have three offers on the table but they're all very different and they all offer different amounts of value but they're going to have to weigh you know price versus regulatory certainty versus future synergies there's a lot for them to unpack here.
01:05Right and in this particular bid we have Bloomberg intelligence saying that the combination could yield four to five billion dollars in synergies which is definitely something to consider does the board and the investors do they care where the financing comes from because it's very different in each case.
01:22It's true I mean in terms of cash we've heard that Warner Brothers does have a preference towards cash versus stock and whether that cash comes from debt or equity I don't know that it really matters to someone receiving the cash but you know one thing that is interesting about all of this is that analysts have said that for Comcast in particular
01:42this could be a way for them to unlock value out of NBCU because right now they're getting trading at kind of a conglomerate discount and there could be greater synergies with Warner Brothers as well if they combine with them.
01:53So you saw both stocks surge or rise yesterday on on the news but you know it remains to be seen what the board's going to decide.
02:00Yeah I mean Paramount made an all cash offer but that relies on financing from Apollo and some Middle Eastern money as well. Would that make a difference.
02:08I don't know that it would. I mean we also have to remember that Paramount is backed by David Ellison and his father who together are some of the wealthiest people on earth.
02:20And so they do. I don't know that there's any concern about them having the ability to fund this. Some of the questions that do remain are around you know how they would take out any equity bridge later on.
02:31So maybe they're backstopping the financing themselves but they could bring in other investors later.
02:36So if it goes to somebody who you know takes part of the assets and then doesn't want the other assets what happens to those assets remaining.
02:43So you'll remember a few months ago Warner Brothers had initially announced that it would be separating itself in two and the plan was to separate the streaming and studios from the cable networks which are the you know revenue generating but much slower growth parts of the business.
02:58So the idea is if Netflix or Comcast only buy streaming and studios Warner Brothers would continue with its plan to separate out global networks and so that would be its own separate company and then the buyer would combine with this other business.
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