Andrew here. We’ve got a lot of deal news to bring you below. But keep an eye on this transaction: Meta is partnering with Blue Owl, an investment firm that specializes in private credit, to finance its massive data center in Louisiana, which is expected to cost $27 billion.
Meta is offloading much of the building expense — and risk — to Blue Owl, which will own 80 percent of the financing joint venture. (Meta will also get a one-time $3 billion payout from the vehicle; it has also guaranteed the data center’s lease from the joint venture for 16 years.) The financing for the data center — set to be as big as about 1,700 football fields — is the largest private credit deal yet. Watch for more deals like this in the future.
The calculus behind a potential media mega-deal
Weeks of behind-the-scenes jockeying burst into public view on Tuesday as Warner Bros. Discovery revealed it was considering a sale after receiving takeover interest for some or all of the company.
As potential buyers circle — chief among them Paramount, but also Comcast, Amazon and, reportedly, Netflix — the big question now is how much higher David Ellison, Paramount’s C.E.O., will go above his roughly $23-a-share offer, and whether rivals can outmaneuver him, Lauren Hirsch writes.
The latest: Warner Bros. Discovery, which previously outlined a planned split of its two core businesses, said it was now open to an “alternative separation structure” that would merge its studio and streaming operations with another company while spinning off its cable division.
That structure could unlock a wider range of potential deals. In some ways it would mimic Disney’s 2019 acquisition of 21st Century Fox, which allowed assets like Fox News and the Fox broadcast channel to be spun off into a separate entity.
And it sends a signal to possible suitors that they may be able to acquire only certain parts of Warner Bros. Discovery. That could be particularly appealing to Comcast or to Netflix, whose executives reiterated on the streaming giant’s earnings call on Tuesday that they weren’t interested in legacy media networks.
Wall Street thinks Ellison probably needs to bump up his bid. Jessica Reif Ehrlich, an analyst at Bank of America, told DealBook last week that Warner Bros. Discovery should only consider selling at $30 per share. (Shares of the company jumped 10 percent on Tuesday’s news but closed at $20.33.)
Yet while Ellison has a deep-pocketed backer — his father, the Oracle co-founder Larry Ellison — he doesn’t have unlimited money. Significant questions about the structure of Paramount’s bid remain, Reif Ehrlich said, including whether any deal would end up significantly diluting Paramount shareholders.
Then there’s the Trump factor. Antitrust experts saw potential roadblocks for many of the deal options. But DealBook hears that some people involved in the process believe many of these risks can be managed with M.&A. provisions like a hefty breakup fee.
The bigger question is how President Trump might react to any deal, especially given his strong feelings about CNN, which is owned by Warner Bros. Discovery. Trump has made clear his anger with Brian Roberts, Comcast’s C.E.O., and is friendly with Larry Ellison.
But even Larry Ellison’s relationship with the president couldn’t expedite the lengthy government review of his son’s takeover of Paramount. And Trump has repeatedly shown he is ultimately transactional.
So if Roberts ends up making a play for Warner Bros. Discovery, can he find a way to win over Trump?
HERE’S WHAT’S HAPPENING
Netflix slumps on tax fight with Brazil. Shares in the streaming giant fell more than 6 percent despite the company’s reporting a 17 percent jump in quarterly revenue, thanks to hits like “KPop Demon Hunters” and the second season of “Wednesday.” The culprit: a $619 million payout to settle a tax dispute with Brazil that ate into profits. (The quarter ended before Elon Musk called for people to cancel Netflix subscriptions because of its “woke” content.)
Gold posts its biggest drop in more than a decade. The price of gold fell 5.7 percent on Tuesday, its biggest one-day fall since 2013 — and just a day after settling a record. (Silver followed suit.) Precious metals had been on a tear as investors sought safe-haven assets as refuge from inflation and President Trump’s tariffs.
Novo Nordisk’s chairman steps down. Helge Lund, the Danish drugmaker’s chair, and six other directors said on Tuesday that they would resign after a dispute with the company’s majority shareholder, the Novo Nordisk Foundation. Novo Nordisk, the maker of Ozempic, has been under pressure to turn around its business after falling behind Eli Lilly in the market for next-generation obesity drugs.
Travis Kelce goes activist on Six Flags. The N.F.L. star has teamed up with the hedge fund Jana Partners and others to take a 9 percent stake in the theme park operator, seeking changes to its business and, perhaps, a sale. Jana has worked with sports celebrities before, including Dwyane Wade and C.C. Sabathia, as a way to get attention.
What’s behind the browser war reboot
Artificial intelligence companies are striking fund-raising and computing power deals at a frenzied and seemingly endless clip as they seek to dominate the technology.
That race — and the need to eventually cover its astronomical costs — has led companies like OpenAI to march into increasingly competitive internet sectors to win.
The latest: OpenAI on Tuesday unveiled Atlas, a free browser powered by ChatGPT. (There’s no address bar, per se — all queries go through the chatbot.) Available initially just for Apple’s Mac operating system, the app lets users ask ChatGPT queries directly in the browser, with paying subscribers also getting access to “agents” that can perform tasks on their behalf.
“We think that A.I. represents a rare, once-a-decade opportunity to rethink what a browser can be about,” Sam Altman, OpenAI’s C.E.O., said during the product’s unveiling on Tuesday.
Atlas serves several functions for OpenAI:
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It’s meant to increase engagement with ChatGPT, essentially making a chatbot user’s window for everything online, from browsing to e-commerce.
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It may also increase subscriptions if the so-called agentic mode proves popular, especially as paid-user growth slows in some markets.
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Users’ Atlas activity can be used to train OpenAI’s A.I. models.
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Perhaps more important, it replaces other search engines by default.
Can OpenAI succeed where others haven’t? Other A.I. companies have rolled out A.I.-infused browsers, including Comet by Perplexity and Neon by Opera.
But they haven’t taken much territory from the heavyweights of the category, including Google Chrome and Microsoft Edge — both of which have been beefed up with A.I. capabilities.
The announcement created waves. Shares in Alphabet, Google’s parent company, fell 2 percent on Tuesday. Expect leaders of the tech giant to be peppered with questions about Atlas on the company’s earnings call next week.
Atlas is unlikely in the near term to dethrone Google as the browser market leader, Ronald Josey, a Citigroup analyst, wrote in a research note on Tuesday. But the growth of A.I. agents represents a potential transformation of “the broader internet experience,” especially when it comes to advertising and e-commerce, he added.
“Nobody else has the same incentive as Amazon to find the way to automate. Once they work out how to do this profitably, it will spread to others, too.”
— Daron Acemoglu, a Nobel laureate who studies automation, in a Times report on Amazon’s plans to replace more than half a million jobs with robots. The e-commerce giant has more than tripled its U.S. work force since 2018, to almost 1.2 million people. But its increasingly automated warehouses could create a drastic workplace shift in which the company becomes “a net job destroyer, not a net job creator,” Acemoglu warned.
The incredible growth of the private market
Private capital — the money managed by private equity, venture capital, private credit and other alternative asset managers — has been on a decades-long tear. But a new report by Bank of America’s global research group reveals the staggering scale of the industry and the world’s largest private companies.
The report includes an eye-opening diagram depicting 55 of the largest private companies, which have a combined valuation of $2.8 trillion.
Here are three more data points that caught our eye:
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Private market returns are outpacing the public markets. Bank of America notes that private equity has outperformed the S&P 500 and the Russell 2000 Growth Index each of the last 10 years, by an average of 5.6 and 9.3 percentage points respectively.
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If private capital assets under management were a country, it would have the world’s second-largest economy. Private assets more than doubled over 12 years, to $22 trillion in 2024 from $9.7 trillion in 2012. They account for 8 percent of the overall U.S. market, up from 1 percent in 2000. High returns, investors’ desire to diversify from the stock market and growing access to private markets have fueled that growth.
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Companies are staying private longer, now waiting an average of 16 years to make a public debut, 33 percent longer than a decade ago. The regulatory cost of being public is one reason for the delay. The median compliance cost for a public U.S. company is 4.1 percent of the company’s market capitalization, Bank of America estimated.
What’s next? Retail investors are expected to be the industry’s fastest-growing segment, a trend driven by the Trump administration’s executive order clearing the way for private markets to enter 401(k)s. That could be a boon for retail investors seeking higher returns, though experts caution it could pose serious risks for everyday investors.
THE SPEED READ
Deals
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DraftKings agreed to acquire Railbird Technologies, a trading platform licensed by the Commodity Futures Trading Commission, as it moves to expand from sports betting into prediction markets. (WSJ)
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The activist investor Starboard Value has pushed TripAdvisor to sell itself or divest its restaurant review business, TheFork. (Bloomberg)
Politics, policy and regulation
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Paul Ingrassia, President Trump’s nominee to head the Office of Special Counsel, has dropped out after pushback from Senate Republicans over a report about racist texts. (NYT)
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Mohammed bin Salman, the Saudi crown prince, reportedly plans to visit the White House for the first time since 2018, with expanding the Abraham Accords high on the agenda. (WSJ)
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“Walmart Pauses Job Offers to Candidates Needing H-1B Visas” (Bloomberg)
Best of the rest
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Sumaiya Balbale resigned as the C.O.O. of the venture capital firm Sequoia Capital after the company reportedly declined to discipline Shaun Maguire, a partner and Elon Musk ally, for Maguire’s posts about the New York City mayoral candidate Zohran Mamdani that she regarded as Islamophobic. (FT)
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France won’t receive reimbursement for the jewels of “inestimable” value that were stolen in Sunday’s Louvre Museum heist because it had not insured them. (FT)
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“The U.S. Is Trying to Drive a Wedge Between Argentina and China” (WSJ)
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A meme stock-style frenzy has driven up Beyond Meat shares almost 1,300 percent in recent days. (Bloomberg)
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Andrew Ross Sorkin is a columnist and the founder of DealBook, the flagship business and policy newsletter at The Times and an annual conference.
Bernhard Warner is a senior editor for DealBook, a newsletter from The Times, covering business trends, the economy and the markets.
Sarah Kessler is the weekend edition editor of the DealBook newsletter and writes features on business.
Michael J. de la Merced has covered global business and finance news for The Times since 2006.
Niko Gallogly is a Times reporter, covering business for the DealBook newsletter.
Lauren Hirsch is a Times reporter who covers deals and dealmakers in Wall Street and Washington.
The post Hollywood’s Latest Cliffhanger: The Fate of Warner Bros. Discovery appeared first on New York Times.
