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Warner Bros Discovery has said Paramount Skydance’s $110bn offer for the Hollywood studio is “superior” to an existing deal with Netflix, giving David Ellison’s media group the upper hand in a fierce takeover battle.
WBD said on Thursday that its board had deemed Paramount’s $31-per- share offer “a superior company proposal”. Netflix now has four business days to sweeten its bid or risk losing the deal it struck in December.
The verdict from WBD’s board puts the media group, run by Ellison and bankrolled by his father, Oracle founder Larry Ellison, in pole position to succeed in its months-long effort to trump Netflix’s deal.
It is a striking turnaround for Paramount, which first approached Warner Bros in October with a proposed deal. But the Warner Bros board rebuffed the idea, and dismissed repeated offers from Paramount.
Paramount’s offer includes a $0.25-a-share fee for every quarter the deal does not close after the end of September next year, a guarantee of a $7bn break fee if it is not approved by regulators and an offer to cover the $2.8bn termination fee owed to Netflix.
WBD said the Netflix deal remained in effect until it weighs Netflix’s response following the four-day deliberation period.
Paramount’s offer for WBD is for the entire business, including CNN and other cable networks, which would be spun into a separate company if the Netflix deal goes ahead.
Netflix did not respond to a request for comment.
This is a developing story
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