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Warner Bros. Discovery said Tuesday it's expanding its strategic review of the business and is open to a sale, sending shares of the company 10% higher in morning trading.
Earlier this year, WBD announced plans to split into two separate entities, a streaming and studios business and a global networks business. It's also been fielding takeout interest from the newly merged Paramount Skydance.
But on Tuesday, WBD said it's received "unsolicited interest" from multiple parties and will now review all options. The company said it's still moving toward the previously announced separation in the meantime.
"We continue to make important strides to position our business to succeed in today's evolving media landscape by advancing our strategic initiatives, returning our studios to industry leadership, and scaling HBO Max globally," CEO David Zaslav said in a statement. "We took the bold step of preparing to separate the Company into two distinct, leading media companies, Warner Bros. and Discovery Global, because we strongly believed this was the best path forward."
"It's no surprise that the significant value of our portfolio is receiving increased recognition by others in the market. After receiving interest from multiple parties, we have initiated a comprehensive review of strategic alternatives to identify the best path forward to unlock the full value of our assets," he said.
Netflix and Comcast are among the interested parties, sources told CNBC's David Faber.
WBD decided to publicly announce it has had interest from multiple parties after rejecting several different bids from Paramount and an offer from another company that was higher than the Paramount bid, according to a person familiar with the matter.
It is unclear how serious potential offers outside of Paramount would be. Netflix was not interested in buying legacy media assets, but didn't want WBD to go to another buyer at a low price, a source familiar with the matter said.
While Comcast does feel the need to do a deal, it will look at the possibility of pursuing WBD, sources close to the company told CNBC's Julia Boorstin. Still, it does not mean Comcast will seek a deal.
For any buyer that just wants WBD's studio and streaming assets, acquiring them after a split later this year is better for tax purposes.
Paramount and WBD spokespeople declined to comment. Netflix and Comcast did not immediately respond to requests for comment.
WBD has faced mounting financial challenges since the 2022 merger of WarnerMedia and Discovery Inc., which saddled the company with over $40 billion in debt. It has since undertaken aggressive cost-cutting, restructured its content pipeline and focused on profitable franchises like "Harry Potter" and "Game of Thrones" spinoffs.
Though the company has made progress in debt reduction, investors have remained skeptical in part because of the company's cable network portfolio as consumers move toward streaming.
