Warner Bros. Plans to Reject Paramount Offer Next Week
(Bloomberg) — Warner Bros., according to people familiar with the company’s thinking. Discovery Inc. plans to once again reject a takeover bid from Paramount Skydance Corp. after the rival media company changed its bid terms.
Warner Bros. He said the board of directors has not yet made a final decision but will meet next week. The board’s concerns include Paramount not yet increasing its offer, but Warner Bros. It had previously rejected this offer on the grounds that it was lower than Netflix Inc.’s offer.
Paramount, which owns its eponymous studio and MTV, is running a public campaign to rally support for its bid to buy Warner Bros., which owns HBO and CNN. Paramount went public with a cash offer of $30 per share on Dec. 8, three days after Warner Bros. agreed to a deal with Netflix, which acquired Warner Bros. alone. studio and broadcasting businesses. Paramount has changed its bid twice since then; most recently including billionaire Larry Ellison’s assurance that he would personally guarantee $40.4 billion in equity financing and other commitments.
Paramount is controlled by Larry Ellison and his son David, a film producer who has now built a media empire. The Ellisons took control of Paramount in August and have been with Warner Bros. since then. They submitted numerous proposals for; This would give their small company another one of Hollywood’s original studios and give them more scale in broadcasting.
Sources, Warner Bros. He said the board remained inactive and expected Paramount to increase the financial terms of its offer. Many shareholders said they expected Paramount to offer more money. The board also worries that the Paramount deal won’t allow the company to manage its debt without the Ellisons’ approval and doesn’t guarantee that Paramount will absorb the breakup free of charge, which would mean Warner Bros. would have to pay Netflix.
Warner Bros. has argued in its public filings that it believes the Netflix bid is superior to Paramount’s for several reasons, including the fact that Paramount is heavily indebted and plans to cut more jobs. Netflix is Hollywood’s most valuable company, with a market value exceeding $400 billion.
More stories like this available Bloomberg.com
