Comcast president and soon to be co-CEO Mike Cavanagh, in a post mortem of the company’s flirtation with buying Warner Bros., said its offer was “light on cash” relative to bids by rivals Netflix and Paramount and “we didn’t expect that we had a high likelihood of prevailing with a deal that made sense to us.”
Speaking at the UBS media conference in NYC today, he said that once Warner Bros. Discovery launched an auction process that included bids for Warner Bros. solo, “We debated whether to bother or not. Do we want the disruption? Do we want the distraction? Et cetera, et cetera. But it’s our job, so we thought, better to take a look and do the work and see where it leads. You never know. And so that’s what we did.”
On Friday, Netflix emerged the winner in a deal for the Warner Bros. studio and streaming assets. Earlier today, David Ellison’s Paramount Skydance launched a hostile takeover bid for the entire company.
But in the end, Cavanagh said, the company opted against “stressing the Comcast balance sheet” with a large cash offer. “What we did offer was a significant chunk of equity in a combined entertainment company that would have combined NBCUniversal, parks, media and studios, together with the studio and streaming segment of Warner Brothers, and provide to the Warner Brothers shareholders a substantial percentage of that company. And that company would have been a publicly traded, controlled subsidiary of Comcast. So that all fit as a proposal that made sense to us.
“Had that come to be, I think it would have been an interesting play. It probably would have changed our streaming aspirations to be global streaming aspirations by necessity, but otherwise, I respect and understand the decision of the Warner Bros. board … I think we’re better for having taken a look. I think our management team went through the exercise of reverse due diligence, and I think showed really well, and we walked away feeling great about our business and our strategies.”
He said another thing “that’s obvious in a world of consolidation, and I’ve lived through it … is we’re going to hit a moment in time now where there’s a lot of distraction. And I think being focused … and getting the job done is going to be what the next couple of years give us an opportunity to do.”
Comcast is in the midst of its own strategic restructuring, on the cusp of spinning off its cable networks and some digital assets into a new public company called Versant.
