Warner Bros. Discovery spurns Paramount’s hostile bid, backing its superior $83 billion Netflix merger for shareholder value and certainty.
NEW YORK: Warner Bros. Discovery has rejected a hostile takeover bid from Paramount Global.
The company stated its agreed merger with Netflix represents superior value for shareholders.
Paramount launched an all-cash tender offer last week valuing Warner Bros. Discovery at $108.4 billion.
This was an attempt to trump Netflix’s earlier announced acquisition deal.
Netflix had shocked the industry by sealing an agreement to buy the studio for nearly $83 billion on December 5. Warner Bros. Discovery said the Paramount offer “fails to address key concerns”.
The company criticised the bid as risky and backed by “an unknown and opaque revocable trust”.
It also noted the offer involved “no Ellison family commitment of any kind”.
Paramount CEO is David Ellison, son of Larry Ellison, an ally of former US president Donald Trump.
Trump repeatedly commented on the bidding war, saying Netflix’s deal “could be a problem”.
He later stated he wanted to ensure CNN gets new ownership as part of any sale.
Paramount’s bid included buying cable channels like CNN, TNT, TBS and Discovery.
These would have been added to Paramount’s existing TV assets like CBS and MTV.
In contrast, Netflix’s offer did not include those specific cable channel assets.
As Netflix emerged as the likely winner, Hollywood elites launched a campaign against the acquisition.
The streaming giant is viewed as a pariah in some circles for disrupting traditional practices.
Netflix CEO Ted Sarandos sought to reassure critics in a recent interview.
He said the company would continue to release Warner Bros. films in cinemas if its takeover succeeds.
“We’re going to continue to operate Warner Bros. studios independently,” Sarandos said.
He admitted his past comments on theatrical distribution “now confuse people”.
