Days after Warners agreed to be acquired by Netflix for $82.7 billion, Paramount Skydance launched a hostile $108.4 billion bid to acquire Warner Bros. Discovery (WBD) on Monday.
Paramount is making an all-cash offer of $30 per share directly to WBD shareholders, noting that its offer provides shareholders with $18 billion more cash than the deal with Netflix, which offered $23.25 in cash and $4.50 in Netflix stock, for a total of $27.75.
Paramount is bidding for the entirety of WBD, but Netflix’s deal with the company includes only the Hollywood studio and streaming operations.
CNBC reported on Monday that these are the exact terms from Paramount that the WBD board rejected a week ago.
“We believe the WBD board is pursuing an inferior proposal that exposes shareholders to a combination of cash and stock, uncertain future transaction amounts for Global Networks’ linear cable business, and a difficult regulatory approval process,” Paramount CEO David Ellison said in a statement.
Paramount’s offer is backed by $54 billion in debt commitments from Bank of America, Citi and Apollo, as well as equity financing from the Ellison family and private equity firm Redbird Capital.
Netflix won a bidding war with Paramount and Comcast on Friday to take the lead, but Paramount’s hostile bid is sure to prolong the battle for one of Hollywood’s most iconic studios, a battle that has already been going on for months.
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Netflix’s proposed deal, which would combine two of the most popular streaming platforms into one, has already raised antitrust questions. Additionally, President Donald Trump said the deal “could be problematic” because of the combined market share of both companies.
WBD’s agreement with Paramount is likely to raise similar concerns.
Netflix has agreed to pay WBD $5.8 billion if no deal is reached. If WBD decides to terminate the contract, Netflix will have to pay $2.8 billion.
Netflix did not respond to a request for comment.
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