In a dramatic twist to the ongoing media mega-merger saga, Paramount Skydance has launched a $108.4 billion bid for Warner Bros. Discovery (WBD).
This latest move directly challenges the $82.7 billion deal Warner Bros struck last week with streaming giant Netflix.
Netflix had emerged victorious on Friday from a weeks-long bidding war with Paramount and Comcast, securing a $72 billion equity deal for Warner Bros Discovery’s TV, film studios, and streaming assets.
Under this deal, Warner Bros was valued at a total enterprise value of approximately $82.7 billion.
Also, under the terms, each Warner Bros. Discovery shareholder will receive $23.25 in cash and 4.501 shares of Netflix common stock per share held. The transaction values Warner Bros. Discovery at $27.75 per share.
However, Paramount launched a $108.4 billion bid, meaning the saga for Warner Bros and its prized HBO and DC Comics assets will not conclude swiftly.
The Paramount bid for Warner Bros Discovery offers WBD shareholders $30 per share, significantly surpassing Netflix’s implied offer.
Paramount argued that its $30-per-share, all-cash offer for the entirety of Warner Bros Discovery is superior to Netflix’s bid, providing shareholders $18 billion more in cash and an easier path to regulatory approval.
Paramount, after it launched a $108.4 billion bid also argued that the combination of its company and Warner Bros would be in the best interest of the creative community, movie theaters, and consumers, who it said would benefit from enhanced competition.
“We believe our offer will create a stronger Hollywood,” Paramount CEO David Ellison said in a statement.
Paramount also maintained that by purchasing Warner Bros, it would be a champion of Hollywood and its talent, would remain committed to releasing movies in theaters, and that its path to regulatory approval would be faster than Netflix’s.
“Our proposal is superior to Netflix’s in every dimension, higher headline value, increased certainty in that value, greater regulatory certainty, and a pro-Hollywood, pro-consumer and pro-competition future,” said Ellison.
In its appeal to shareholders, Paramount said it submitted six proposals over the course of 12 weeks, but Warner Bros “never engaged meaningfully” with these proposals.
In a regulatory filing, Paramount said that the Ellison family, which owns Paramount, along with private equity firm RedBird, had agreed to backstop $40.7 billion in equity capital.
The offer also includes financing from Affinity Partners, run by United States President Donald Trump’s son-in-law Jared Kushner; other financing comes from the Saudi and Qatari sovereign wealth funds and L’imad Holding Co, owned by the government of Abu Dhabi.
Netflix’s offer comes with a $5.8 billion break-up fee and was likely to face strong antitrust scrutiny; U.S. President Donald Trump raised questions about the offer over the weekend.
Addressing journalists after he arrived at the Kennedy Center in Washington for a cultural event, Trump said the merger, which would fold one of Hollywood’s most storied studios into the world’s largest streaming platform, warranted a closer look from federal regulators.
“That’s got to go through a process, and we’ll see what happens. But it is a big market share. It could be a problem,” he said.
