Key points
- Paramount says its $30 per share offer gives shareholders clear cash value. Paramount calls Netflix’s plan an inferior proposal that risks delay.
- The bid is backed by Ellison family funds and Middle East partners. Paramount says investors will forgo governance rights to limit scrutiny.
- WBD board will review Paramount’s offer but stays with Netflix recommendation. Share trading reacted as Paramount and WBD stocks rose while Netflix fell.
Paramount Skydance on Monday made a bold all cash bid for Warner Bros Discovery, offering shareholders $30 a share. The offer values WBD at roughly $108 billion and aims to replace Netflix’s earlier studio deal.
Paramount said the Ellison family and RedBird Capital would backstop the full equity needed for the bid. The company also named financing from Saudi, Abu Dhabi and Qatar sovereign funds and Jared Kushner’s Affinity Partners in its package.
Paramount argued its cash offer gave shareholders faster certainty than Netflix’s cash and stock package. Paramount added that its backers agreed to forgo governance rights to reduce national security concerns.
Why Paramount says its offer is better
Paramount said its bid adds about $18 billion more in cash than Netflix’s proposal. The company also warned that Netflix faces long antitrust delays that could stretch for many months.
Paramount accused Netflix of offering an unrealistic timeline for regulatory approval and called that a major risk to shareholders. The bid aims to force shareholders to weigh certainty against the potential upside of Netflix stock.
Paramount took its campaign directly to investors after saying WBD did not engage with earlier proposals. The offer comes after a three month auction that ended with WBD’s board selecting Netflix late last week.
How the market and Washington reacted
Markets moved on the news with WBD shares rising and Paramount stock jumping on Monday. Netflix shares fell as investors weighed the chance of a bidding contest and regulatory hurdles.
The US president said he would review the deal and noted he would check market share issues. Paramount said it expected the political review but stressed its backers would not seek board seats.
Analysts say the final decision will hinge on how shareholders judge antitrust risk, the value of WBD’s cable assets, and the longer term upside of holding Netflix stock. Paramount values the cable unit lower than Netflix does in its package.
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What each offer covers
Netflix’s agreement covers WBD’s studio and streaming parts and excludes cable networks such as Discovery and CNN. Netflix valued those studio and streaming assets at about $27.75 per share under its cash and stock deal.
Paramount’s all cash bid covers the whole group including cable assets and sets the offer at $30 a share. That makes Paramount’s offer more cash rich for shareholders who want immediate value.
If WBD sticks with Netflix then a break fee could apply. WBD may be required to pay Netflix a fee if it cancels that agreement and accepts the rival bid.
Where this battle goes next
WBD’s board said it will carefully review Paramount’s tender offer but has not changed its recommendation for the Netflix deal. Shareholders have until January 8 to respond to Paramount’s tender offer, though that deadline may be extended.
Paramount said it has already filed the offer and will press shareholders to choose what it called the superior cash option. Netflix said it expected rival offers and remained confident it would close its deal.
The fight may now move to shareholders and to regulators who will assess antitrust and national security angles. Both bidders face legal and political checks that could shape the final outcome.
