Discovery gets a boost from erroneous merger rumors

Liberty Media's John MalonePhoto: Liz Sullivan

Is the "Shark Week" programmer becoming prey?

An erroneous report about merger talks between Discovery Communications and 21st Century Fox gave the cable programmer a big lift on Monday and spurred talk of other possible merger proposals to come.

Discovery surged 8 percent on Monday morning, before closing the session at $32.33, up 4.5 percent — an indication that investors like the idea.

Nomura entertainment analyst Anthony DiClemente told The Post that Discovery's European sports assets and its ownership of Scandinavian pay-TV company SBS would be a good fit, even if the talks aren't happening.

"You would have an international powerhouse as far as cable, but the devil is in the price and the multiple a buyer would be willing to pay," he added.

Of course, Liberty Media's John Malone, who holds a 22 percent voting interest in Discovery Communications, and another powerful shareholder, Advance/Newhouse Communications, would both have to give their consent.

Malone has been out considering a host of combinations for his programming interests from ITV in the UK to premium TV outfit Starz and most recently Lionsgate. "Malone likes having optionality. He has a positive view on consolidation," said DiClemente.

Charter, a Malone-controlled cable distributor, may even be in on the hunt for content assets with a Viacom tie-up touted by some.

Meanwhile, Bernstein analyst Todd Juenger added in a report that Discovery/Fox would be "the absolute killer combination," adding, "That would create a situation with Fox/Discovery and Disney clearly the best-positioned global media companies, with everybody else fighting to be a distant third."

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