Paramount Makes a $108.4 Billion Hostile Bid for Warner Bros Following Netflix Deal
Days after Netflix offered to buy Warner Bros. Discovery (WBD) for $72 billion, Paramount has forced itself back into the conversation by making a hostile bid of $108.4 billion.
Written by Jackie Leavitt (Editor at Large)
Reviewed by Aleksander Hougen (Chief Editor)
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Paramount’s bid is worth $30 per share in cash, versus Netflix’s offer was worth $27.75 per share mixing cash and stock, giving $18 billion more in cash to WBD shareholders than Netflix’s offer. However, Netflix’s bid was limited to Warner Bros film and TV studios, HBO and HBO Max streaming service, while Paramount’s bid also includes WBD’s cable TV properties.
Although the Netflix-WBD deal still needs regulatory approval, if WBD accepts Paramount’s offer, it would need to pay Netflix a $2.8 billion breakup fee; if Netflix pulls out of the deal, Netflix would have to pay $5.8 billion.
Netflix, Paramount Skydance and Comcast had all been vying for WBD, when the company chose Netflix. However, WBD board apparently had concerns about Paramount’s financing, which comes from Affinity partners, an investment firm run by President Trump’s son-in-law Jared Kushner, and from several Middle Eastern government-run investment funds.
The Paramount offer is also backstopped by the Ellison family; Larry Ellison is the co-founder of Oracle Corporation and currently the world’s third richest person, as well as the father of Paramount Skydance head David Ellison.
Although the Netflix offer was met with apprehension over combining two of the largest streaming services, the Paramount offer brings even more concern for similar reasons but also for the potential for political influence.
“A Paramount Skydance-Warner Bros merger would be a five-alarm antitrust fire and exactly what our anti-monopoly laws are written to prevent,” said U.S. Senator Elizabeth Warren, a Democrat. The hostile bid “is backed by a who’s who of Trump buddies … raising serious questions about influence-peddling, political favoritism, and national security risks.”
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