Paramount Skydance on Monday launched a hostile, $108.4 billion bid to acquire Warner Bros. Discovery (WBD) after Warner had agreed to an $82.7 billion acquisition by Netflix.
Paramount is directly approaching WBD shareholders with an all-cash offer of $30 per share. This offer provides shareholders with $18 billion more cash than the Netflix deal, which included $23.25 in cash and $4.50 in Netflix shares, totaling $27.75 per share.
Paramount is bidding for all of WBD, while the Netflix agreement with WBD only encompasses its Hollywood studios and streaming business. CNBC reported on Monday that these terms from Paramount were the same ones WBD’s board rejected a week ago.
“We believe the WBD Board of Directors is pursuing an inferior proposal which exposes shareholders to a mix of cash and stock, an uncertain future trading value of the Global Networks linear cable business and a challenging regulatory approval process,” Paramount CEO David Ellison said.
Paramount’s offer has equity financing from the Ellison family and the private-equity firm RedBird Capital. It also includes $54 billion of debt commitments from Bank of America, Citi, and Apollo.
Netflix won a bidding war against Paramount and Comcast on Friday. Paramount’s hostile bid will likely prolong the multi-month battle for Warner Bros. Discovery.
Netflix’s proposed deal has already drawn antitrust questions, as it would combine two significant streaming platforms. Additionally, President Donald Trump said the deal “could be a problem” due to the combined market share of the companies. A deal between WBD and Paramount would likely raise similar concerns.
Netflix agreed to pay WBD $5.8 billion if their deal does not finalize. If WBD terminates the deal, it would have to pay Netflix $2.8 billion. Netflix did not immediately respond to a request for comment.
