AT&T Lost $47B on This Exact Bundle—Now the Ellisons Are Buying It Back for $111B. Bold Move or Billionaire Ego Trip?
u/osiris_rai ·
Reddit — r/wallstreetbets
· February 28, 2026 at 18:43
· ⬆ 530 pts
· 💬 137 comments
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Summary
The post discusses the proposed acquisition of Warner Bros. Discovery (WBD) by David Ellison's Skydance, backed by his father Larry Ellison, for $111 billion. This price is nearly identical to the price AT&T paid for the same assets in 2018.
The author's thesis is that this deal is a massive, ego-driven gamble that is financially unsound. The author highlights the enormous debt load the combined company will carry, the declining value of its linear TV assets, and the fact that a similar bet by AT&T resulted in a $47 billion loss.
Quality assessment: This is well-researched speculation. The author provides specific figures (deal price, debt load, stock performance, historical context) to support a strong, albeit speculative, thesis about the deal's viability.
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Larry Ellison, one of the richest people alive, just personally guaranteed $45.7 billion so his son David could buy a Hollywood studio. That's about a fifth of his entire fortune, locked in with an irrevocable pledge he can't undo while the deal is open.
Total price: $111 billion. The Ellison family is putting up the equity, and $57.5 billion in debt is coming from Bank of America, Citigroup, and Apollo. But follow the money trail: AT&T paid almost the exact same price for these same assets in 2018 ($108.7 billion). Four years later, AT&T bailed and sold them for roughly $43 billion, a $47 billion loss for shareholders. So the same HBO, same Warner Bros. studio, same DC Comics, and CNN are being sold for the third time in eight years, at nearly the same price that already wrecked one buyer.
Nine months ago, WBD stock was $7.52. Today it's near $29. That 284% run wasn't driven by better business results. It was driven entirely by a bidding war between Netflix and Paramount that kept escalating until Netflix finally walked away. Netflix stock jumped 13% the moment they dropped out. They'll spend $20 billion making their own stuff instead.
The debt math is something else. WBD already carries about $33.5 billion in debt, mostly inherited from the AT&T era. Paramount is now stacking $57.5 billion more on top. The combined company will be one of the most highly leveraged media companies ever assembled, while the cable TV side of the business (CNN, TNT, Discovery Channel) continues to lose viewers and ad revenue every quarter.
David Ellison founded Skydance in 2006. Only five of its films have crossed $200 million at the domestic box office, three of them starring Tom Cruise. He merged Skydance with Paramount last August. Now he's absorbing all of Warner Bros. Hollywood's Big Six studios, which became the Big Five when Disney bought Fox in 2019. Now the Big Five becomes the Big Four.
The last person who bet $108 billion that they could build a media empire around Warner Bros. was AT&T's CEO. He was off by about $47 billion.