Warner Bros. Discovery (WBD) and Paramount (PARA) are said to 𒀰be in early talks about an entertainment mega-merger.

Warner Bros. Discovery CEO David Zaslav met with Paramount Global CEO Bob Bakish in New York City this week to discuss the possible merger. The talks were first reported by Axios.

Warner Bros. Discovery's market value is around $27 billion, while Paramount's is just over $10 billion, and the latter is carrying a significant debt load. Paramount's non-executive Chair Shari Redstone, who owns a controlling stake through the holding company National Amusements, is said to be interested in a sale.

The deal could shake up the entertainment industry and lead to further consolidation, with the two companies likely seeking to combine their Paramount+ and Max streaming services in a bid to challenge rivals Netflix (NFLX) and Disney (DIS).

Warner Bros. Discovery, which was created by the $43 billion 澳洲幸运5官方开奖结果体彩网:merger of𒁏 Warner Media and Discoveꦺry, has been on a cost-cutting drive and has a couple of wins under its belt this year. Max is the only streaming service besides industry leader Netflix that is profitable. The company also released the highest-grossing film of the year, Barbie, which took in almost $1.5 billion in global box office sales.

The deal could offer both companies several synergies. Both companies own news stations—Paramount's CBS News and WBD's CNN—that could be combined. Paramount also has its movie studio, which could be combined with Warner Bros. to ramp up production of original streaming content.

Shares of Warner Bros. Discovery were down 4.7% as of 10:50 a.m. ET Thursday, while Paramount shares slipped 1.7%.