If Warner’s board changes course and deems Paramount’s latest offer superior, Netflix will be able to revise its bid.
Warner Bros Discovery (WBD) says it is reviewing a new takeover offer from Paramount Skydance, but it continues to recommend a competing proposal from Netflix to its shareholders in the meantime.
Warner disclosed on Tuesday that it had received a revised offer from Paramount after a seven-day window to renew talks with the Skydance-owned company elapsed on Monday. Paramount – which is run by David Ellison, son of United States President Donald Trump ally and Oracle cofounder Larry Ellison – confirmed it had submitted the proposal, but neither company provided details about it. The company was widely expected to have raised its offer.
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A WBD buyout would reshape Hollywood and the wider media landscape, bringing HBO Max, cult-favourite titles like Harry Potter and, depending on who wins the Netflix vs Paramount tug-of-war, potentially even CNN under a new roof.
Paramount wants to acquire Warner Bros in its entirety, including networks like CNN and Discovery, and went straight to shareholders with an all-cash, $77.9bn hostile offer just days after the Netflix deal was announced in December. Accounting for debt, that bid offered Warner stakeholders $30 per share, amounting to an enterprise value of about $108bn.
Paramount maintained on Tuesday that its tender offer remains on the table while Warner evaluates its latest proposal.
Netflix wants to buy only Warner’s studio and streaming business for $72bn in cash, or about $83bn including debt. Warner’s board has repeatedly backed this deal and on Tuesday maintained that its agreement with Netflix still stands.
Warner shareholders are to vote on the Netflix proposal on March 20.
If Warner’s board changes course and considers Paramount’s latest offer superior, Netflix would have a chance to match or revise its proposal, potentially setting the stage for a new bidding war. It could also choose to walk away.
Further consolidation
Paramount, Warner and Netflix have spent the last couple of months in a heated back and forth over who has the stronger deal. But along the way, lawmakers and entertainment trade groups have sounded the alarm, warning that either buyout of all or parts of Warner’s business would only further consolidate power in an industry already run by just a few major players. Critics said that could result in job losses, less diversity in filmmaking and potentially more headaches for consumers who are facing rising costs of streaming subscriptions as is.
Combined, that raises tremendous antitrust concerns – and a Warner sale could come down to who gets the regulatory greenlight. The US Department of Justice has already initiated reviews, and other countries are expected to do so too.
Both Paramount and Netflix have argued that their proposals are good for consumers and the wider industry. And the companies have taken aim at each other publicly with regulatory arguments.
Paramount has pointed to Netflix’s much larger market value, and it has argued that if the streaming giant acquires Warner, it would only give it more dominance in the subscription video-on-demand space. But Netflix is trying to persuade regulators that it’s up against broader video libraries, particularly Google’s YouTube, America’s most-watched TV distributor.
Paramount’s bid will create a studio bigger than market leader Disney and fuse two major TV operators, which some Democratic senators said would control “almost everything Americans watch on TV”.
It will also hand control of CNN to the conservative-leaning Ellisons, soon after they acquired CBS News and installed as its editor-in-chief Bari Weiss, a right-leaning opinion editor who had no prior TV experience. The network settled for $16m a lawsuit that Trump had filed, accusing CBS’s 60 Minutes programme of editing an interview with Kamala Harris to his 2024 presidential election rival’s advantage. It also appointed Kenneth Weinstein, a former Trump administration official, as ombudsman to investigate allegations of bias.
In December, Ellison visited the White House, media reports said, and told Trump that Paramount would execute “sweeping changes” if it acquired CNN’s parent company.
More recently, Trump, in a Truth Social post on Saturday, demanded that Netflix fire former US National Security Adviser Susan Rice from its board. Rice, a Black woman, had served under former Presidents Barack Obama and Joe Biden, both Democrats.
“This is a business deal. It’s not a political deal,” Netflix CEO Ted Sarandos told BBC Radio 4’s flagship Today programme on Monday. “This deal is run by the Department of Justice in the US and regulators throughout Europe and around the world.”
Trump previously made unprecedented suggestions about his involvement in seeing a deal through before walking back those statements and maintaining that regulatory approval will be up to the Justice Department.
