Paramount pushes quick DOJ review of Warner Bros. bid amid bidding war with Netflix
According to Bloomberg, citing people with knowledge of the matter, Paramount Skydance Corp., Warner Bros. Discovery Inc. is pushing to complete the Justice Department’s antitrust review of the tender offer for its shares within the next few weeks.
People speaking to the news portal said that the entertainment and media giant has provided the information requested by the government. A 10-day waiting period will be required to complete this task, during which the Department of Justice will decide whether to object to Paramount’s offer due to antitrust concerns.
Getting early approval from regulators is a key part of Paramount’s plan to thwart Netflix Inc.’s planned acquisition of Warner Bros. studios and broadcasting businesses. If Paramount can show it has cleared a significant regulatory hurdle, Warner Bros. will try to persuade its shareholders to vote against the Netflix deal.
In December, Warner Bros. agreed to sell its studios and streaming divisions to Netflix for $82.7 billion, preferring it over a rival offer from Paramount. Warner Bros. plans to seek shareholder approval for the deal by April. Paramount, meanwhile, is trying to bypass the deal by appealing directly to shareholders and lobbying regulators.
The Justice Department could sue to block Netflix, giving Paramount a better chance of winning over Warner Bros. without needing to increase its $30-per-share cash offer. A Netflix spokesperson told the news portal that the company expects Paramount to “self-declare” that it is in compliance with federal regulators. “We continue to focus on the value Netflix and Warner Bros. can create together,” the spokesperson was quoted as saying.
Livemint was unable to independently verify the report.
The Justice Department is thoroughly reviewing offers from Netflix and Paramount, Bloomberg previously reported. People with knowledge told the news portal that federal authorities have sent requests for information to major Hollywood constituencies, including talent agencies.
What does DOJ approval mean?
The Justice Department’s approval does not guarantee that Paramount is open. Paramount must change important terms such as price or eventually Warner Bros. If it signs a merger agreement with , its proposal will likely need to be resubmitted for DOJ review. Warner Bros. shareholders expect Paramount to increase its offer.
Paramount and Netflix are subject to scrutiny from attorneys general in the US, as well as ongoing scrutiny in the EU and the UK.
Paramount has so far rejected Warner Bros., arguing that its offer is better than Netflix’s and more likely to win regulatory approval. It resisted increasing its $108 billion bid for Paramount CEO David Ellison said the merger of Netflix, HBO and Warner Bros. would create the world’s largest paid streaming company. The Netflix deal has faced criticism, including bipartisan opposition at a Senate hearing on February 3.
Warner Bros. and Netflix expressed confidence in their ability to get approval for their deals and argued that the Paramount deal would further harm Hollywood. But they are also aware that the Justice Department’s review is expected to continue later this year.
