Paramount Skydance presented a Cash offer for all Warner Bros. Discovery (WBD)a move that directly calls into question the tentative agreement announced weeks ago between WBD and Netflix.
Paramount’s proposal also values the conglomerate $108.4 billionwhich implies a 139% premium compared to Warner’s share price in September. In a statement, the company described Netflix’s offering as “inferior and unsafe” and argued that shareholders deserve to consider a stronger alternative.
“WBD shareholders deserve the opportunity to consider our outstanding cash offersaid David Ellison, President and CEO of Paramount.
Unlike Netflix – which only wants to acquire the Warner Bros. studio and the HBO Max platform – Paramount Skydance intends to retain the entire groupincluding its television channels. Before the opportunity to sell arose, WBD considered these signals – such as: cnn And discovery– due to its lower growth potential in a U.S. market where cable television continues to decline.
Ellison remembered that Paramount was the first to become interested in WBD and that it submitted at least five offers prior to this new proposal. However, the board then decided to continue negotiations with Netflix, which had also outbid Comcast in the tender.
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Competition and regulations
In an interview with CNBC, Ellison asserted that Paramount’s “the highest offer on the table“The Netflix proposal, which included a portion of the payment in stock, valued Warner Bros. and HBO Max 83 billion dollarsDebt included. Paramount, on the other hand, offers financing the entire process in cash.
The company was able to raise the funds thanks, among other things, to the financial support of the Ellison family. David’s father, Larry EllisonHe is the second richest man in the world with an estimated net worth 270 billion dollarsaccording to Forbes.
Ellison also argued this Paramount’s proposal has a better chance of getting the green light from regulators as Netflix. In this sense, the President said during a recent event in Washington Donald Trump expressed reservations about a possible merger between Netflix and Warner Bros., noting that the platform already has “a very large market share.” “could be a problem.”
The Netflix-WBD merger would bring together two of the three largest streaming services in the world – not counting Amazon Prime due to its hybrid model – with more than $100,000 300 million subscribers In the case of Netflix and 128 million on HBO Max. “The merger of the world’s first streaming service with the third is bad for competition”Ellison remarked.
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