Warner Bros likely to reject $108.4 billion Paramount bid, back Netflix in bidding war, sources say

Warner Bros. Discovery’s board of directors could announce its decision on Paramount Skydance’s $108.4 billion acquisition offer as soon as Wednesday, and the board will likely recommend shareholders vote against the offer, according to people familiar with the matter. Netflix’s decision to recommit to its acquisition offer will be the latest twist in the race for assets including Warner Bros.’ storied film and TV studio and its extensive film and television library, whose portfolio includes classics ranging from “Casablanca” and “Citizen Kane” to contemporary favorites like “Harry Potter” and “Friends” to HBO and its HBO Max streaming service.

A spokesperson for Warner Bros. Discovery declined to comment. The winner will gain a huge advantage in the streaming wars by locking in a deep content library, which has long been an acquisition target. Netflix prevailed earlier this month with a $27 cash-and-stock offer from Warner Bros. for its non-cable assets.

Paramount CEO David Ellison then went directly to Warner Bros. shareholders with a $30 per share, all-cash offer for the entire company.
In regulatory filings, Paramount said its proposal was superior to Netflix’s and would have a clearer path to regulatory approval. Its offering is financed by $41 billion in new equity backed by the Ellison family and RedBird Capital and $54 billion in debt commitments from Bank of America, Citi and Apollo.

Jared Kushner’s Affinity Partners, one of Paramount’s financing partners, is exiting the battle, according to Bloomberg.

Paramount and Affinity Partners did not immediately respond to Reuters’ request for comment.