Battle for Warner Bros in spotlight as Netflix and Paramount bid for deal

Paramount has gone hostile in its bid for Warner Bros Discovery, challenging Netflix, which reached a $72bn takeover deal with the company just days ago.

Last week Netflix said that it would acquire Warner Bros Discovery.

“We recently announced that Netflix will acquire Warner Bros., including its film and television studios, HBO Max and HBO.

“This unites our leading entertainment service with Warner Bros.’ iconic stories, bringing some of the world’s most beloved franchises like Harry Potter, Friends, The Big Bang Theory, Casablanca, Game of Thrones and the DC Universe together with Stranger Things, Wednesday, Squid Game, Bridgerton and KPop Demon Hunters,” Netflix said.

Finer details 

Netflix at the time said nothing was changing as the deal needs to finalised and approved before any significant changes can be made.

“Both streaming services will continue to operate separately. We have more steps to complete before the deal is closed, including regulatory and shareholder approvals. You’ll hear from us when we have more to share.”

Hostile

However, Paramount went hostile in its bid for Warner Bros Discovery saying it was going straight to shareholders with a bid worth about $74.4bn, or $30 per share in cash.

Paramount said its offer is worth about $18bn more than the competing bid from Netflix, which it says is based on an “illusory prospective valuation” of those cable assets.

It is the same bid that Warner Bros rejected in favour of the offer from Netflix in a merger that would alter the US entertainment landscape.

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Criticism

Paramount criticised the Netflix offer, saying it “exposes WBD shareholders to a protracted multi-jurisdictional regulatory clearance process with an uncertain outcome along with a complex and volatile mix of equity and cash”.

Paramount said it had submitted six proposals to Warner Bros Discovery over a 12-week period,” Al Jazeera reported.

“We believe our offer will create a stronger Hollywood. It is in the best interests of the creative community, consumers and the movie theater industry,” Paramount Chairman and CEO David Ellison said in a statement.

“We believe they will benefit from the enhanced competition, higher content spend and theatrical release output, and a greater number of movies in theaters as a result of our proposed transaction.”

Trump gets involved

On Sunday, US President Donald Trump said that the deal struck by Netflix to buy Warner Bros Discovery “could be a problem” because of the size of the combined market share.

Trump said he would be involved in the decision about whether the federal government should approve the $72bn Netflix deal.

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