Warner Bros Discovery puts itself in play after bidder rush

Good morning. Here's what happened overnight and what you need to know today.

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1.

Succession planning: Warner Bros Discovery said it is open to a sale as it expands its strategic review after gaining “unsolicited interest” from multiple parties to buy part or all of the company. The review will consider a “broad range of strategic options,” including a full sale, separate transactions for Warner Bros and Discovery Global, or proceeding with its planned separation into two businesses by mid-2026. CEO David Zaslav said the company wants to “identify the best path forward to unlock the full value” of its assets. Paramount Skydance made at least two offers for the entire company, which Warner rejected as too low, Bloomberg and The Wall Street Journal reported citing sources. Netflix and Comcast are also looking at Warner’s movie and TV studios, according to media reports. Chairman Samuel Di Piazza said in a statement that while the company continues to believe the planned separation “will create compelling value,” broadening the scope of options is “in the best interest of shareholders.” Allen & Co, JPMorgan Chase and Evercore are advising on the process. Warner shares surged by as much as 14.3% on the news. (Capital Brief)(Warner Bros)(Bloomberg)(WSJ)(Reuters)

2.

Safe landing: Regional Express Airlines, or Rex, will be acquired by US aviation company Air T, after Rex entered voluntary administration in July last year. Infrastructure and Transport Minister Catherine King confirmed that the companies have entered into a sale and implementation deed and that the government also entered into an agreement with Air T in relation to restructuring Rex’s financing arrangements. “This will allow Rex to keep flying and maintain critical aviation links for regional communities,” King said. Rex administrator EY is preparing its report to creditors that “will detail the estimated return to creditors and will provide further details with respect to the proposed transaction,” adding that “no return to shareholders was anticipated.” The airline’s fleet was grounded after it was unable to pay bills and was extended an additional $30 million in government financing to keep regional routes flying until December. (Capital Brief)

3.

Private muscle: The US army asked PE firms including Apollo, Carlyle, KKR and Cerberus to submit proposals for “meaty” strategic projects to support a planned USD150 billion ($231.1 billion) infrastructure overhaul, the Financial Times reported. Army secretary Daniel Driscoll and Treasury secretary Scott Bessent last week hosted a forum with around 15 prominent buyout firms to explore partnerships using underutilised military assets, the report said. Driscoll told the FT the service is looking for “clever” or “unique” financing models, such as swapping land for computing power or rare earth output, with potential projects including data centres and rare earth processing facilities. He said the army has just USD15 billion budgeted over the next decade and would not be able to meet its needs “without creative solutions coming in from outside parties.” The initiative follows a Trump administration executive order allowing retirement plans to invest in private assets. The army expects investment pitches in the coming weeks and wants to finalise multiple deals before the end of the year. (FT)

4.

Gold cracks: Earnings-fuelled gains were pushing the Dow up 0.7% and the S&P 500 0.15% higher on late trading in New York, as strong results from General Motors, 3M, RTX, GE and Coca-Cola buoyed investor optimism. The Nasdaq however was 0.06% lower, as tech and chip stocks lost momentum. Shares in Google parent Alphabet fell after OpenAI announced its first AI-powered web browser, putting the ChatGPT maker in direct competition with Google. GM jumped as much as 16.5% after raising its full-year forecast on stronger-than-expected pickup sales and tariff relief. 3M and GE both lifted forecasts for the second straight quarter. But gold tumbled 5.7% to USD4,109.10 in its largest one-day drop since 2013, reversing Monday’s record high of USD4,381.21. Silver also slid 7.6% and platinum dropped 5.9%. The selloff was attributed to profit-taking, volatility, a stronger dollar, reduced liquidity due to Diwali-related market closures in India. Markets are now focused on Friday’s delayed US inflation data and the Federal Reserve’s expected rate cut next week. (Bloomberg)(Reuters)(WSJ)(Capital Brief)

5.

Ceasefire snub: A planned summit between Donald Trump and Vladimir Putin was shelved, after Moscow rejected Trump’s call for an immediate ceasefire in Ukraine. A White House official told media there are “no plans” for a meeting “in the immediate future,” following a phone call between Secretary of State Marco Rubio and Russian Foreign Minister Sergei Lavrov, which the State Department called “productive.” A Rubio-Lavrov meeting, originally expected in Budapest this week, was also called off. Kremlin spokesman Dmitry Peskov said “serious preparation” was still needed. Lavrov told reporters Trump’s ceasefire proposal was contrary to the understanding reached during the August summit in Alaska, and that freezing the conflict now would mean “a large part of Ukraine would remain under Nazi rule.” He reiterated demands including Ukraine’s neutrality, limits on its military and disavowal of NATO membership. Trump last week said fighting should “stop at the battle line,” a stance supported by European leaders and Ukrainian President Volodymyr Zelensky in a joint statement. However, Trump reportedly pressured Zelensky to surrender all of Donbas during a closed-door White House meeting last Friday. (Bloomberg)(CBS)(Reuters)(NYT)

6.

Healthy buyout: Blackstone and TPG agreed to acquire medical diagnostics firm Hologic in a transaction valued at up to USD18.3 billion (28.2 billion) including debt. Under the agreement, shareholders will receive USD76 per share in cash, plus up to an additional USD3 per share through a non-tradable contingent value right, subject to revenue targets for Hologic’s breast health business in fiscal years 2026 and 2027. The total consideration represents a 15% premium to Hologic’s closing share price last Thursday, before Bloomberg reported a sale was nearing. Goldman Sachs is advising Hologic, while Citigroup is advising the buyer consortium. The deal is one of the largest healthcare take-private transactions this year. It is backed by USD12.25 billion in committed debt financing provided by a banking group including Citigroup, Barclays, Bank of America, RBC and SMBC. The deal also includes minority investments from a unit of the Abu Dhabi Investment Authority and an affiliate of Singapore’s GIC. (Capital Brief)(Hologic)(Reuters)

7.

Ruddslinging match: Anthony Albanese's meeting with Donald Trump was a hotly anticipated diplomatic event and few would characterise it as anything other than a success. But the White House rendezvous was also one of the biggest moments for Australia's political media in a long time, and starkly contrasted the subdued, often tightly controlled press conferences our press pack is subjected to in Canberra. During a rambling and at times unpredictable 35 minute press conference, Trump exhibited many of the traits the American media has grown accustomed to since he returned to the presidency. The Sydney Morning Herald’s Michael Koziol was (somewhat randomly) singled out and branded a “nasty guy” after he attempted to secure a question, while The Nightly’s Latika Bourke was admonished and told to be “quiet” after asking about the US’ military support for Ukraine. Fittingly, it was a blunt question from Murdoch-family controlled Sky News that ended up generating the biggest headlines. (Capital Brief)

8.

Rarefied deal: One of the early winners from the Albanese government's critical minerals deal with the Trump administration has hailed the agreement, amid brewing concerns the funding could be squandered on projects that are not viable in the long-run. ASX-listed Arafura Resources is one of two companies to receive support under the new US-Australia policy framework for mining and processing critical minerals and rare earths, which was announced on Tuesday, receiving a USD100 million ($154 million) equity investment commitment from Export Finance Australia. Arafura Resources chief financial officer Peter Sherrington told the International Mining and Resources Conference in Sydney on Tuesday that increased government support “de-risks” very capital intensive projects, which are key to underwriting industry and manufacturing. The framework seeks to leverage Australia’s Critical Minerals Strategic Reserve as well as the US’ industrial demand and stockpiling infrastructure to secure inputs for defence industry and advanced technology manufacturing. (Capital Brief)