WBD says Paramount’s new, higher offer could be “superior” to Netflix's

Source: Ars Technica

Offer Details

Paramount Skydance increased its bid for Warner Bros. Discovery (WBD) from $30 per share to $31 per share, WBD said today. Amid a competing offer from Netflix for WBD’s movie studios and streaming businesses, WBD said that Paramount’s new bid “could reasonably be expected to lead to a ‘Company Superior Proposal.’”

Under the revised offer, Paramount would also cover the $7 billion regulatory termination fee that would arise if a Paramount‑WBD merger failed to close due to antitrust regulation.

The company owned by David Ellison also said it would pay $0.25 per share for every day the deal doesn’t close, starting on September 30, rather than the previous start date of December 31.

Paramount previously agreed to pay the $2.8 billion termination fee that WBD would be subject to if it canceled its merger deal with Netflix.

Netflix Offer

Netflix has offered $27.75 per share for a smaller portion of WBD’s overall business. Netflix is looking to pay all‑cash for WBD’s film studios, intellectual property, HBO, and streaming services—including HBO Max—but not any of WBD’s other cable channels.

Board Decision

WBD’s board has not yet decided whether Paramount’s revamped offer is better than Netflix’s proposal. If the board determines that Netflix’s offer is superior, Netflix will have four days to present a better offer.

It remains unclear whether Netflix would be willing to increase its bid for WBD’s streaming and movie businesses. The streaming giant has not commented on Paramount’s new offer yet, but on Friday co‑CEO Ted Sarandos told Variety that Netflix’s leadership are “super‑disciplined buyers.”

“We have a reputation for such so that I’m willing to walk away and let someone else overpay for things. We have a rich history of that,” he added.

Regulatory Considerations

Regardless of the ultimate buyer, any WBD merger is expected to face intense regulatory scrutiny, potentially lead to higher subscription prices, and have a lasting impact on Hollywood.