Warner Bros. is advising shareholders to decline a buyout offer from Paramount Skydance, arguing that a competing bid from Netflix would offer better benefits to consumers. In a statement on Wednesday, Warner Bros. expressed confidence that a partnership with Netflix would provide more options and value to customers, enhance the reach of the creative community, and drive long-term growth. The company highlighted the synergies between Netflix’s extensive franchise portfolio and studio capabilities and Warner Bros.’ existing business.
Paramount recently made a hostile bid, urging shareholders to reject the proposed deal with Netflix in favor of their own offer. Paramount’s bid stands at $30 US per Warner share, compared to Netflix’s $27.75 US offer. While Warner Bros. has signaled its preference for the Netflix deal, shareholders retain the option to choose Paramount’s bid, which includes acquiring Warner’s cable assets like CNN and Discovery.
Unlike Paramount’s bid, Netflix’s proposal does not involve purchasing Warner’s cable operations. The acquisition by Netflix, pending regulatory and shareholder approval, will only proceed after Warner completes the planned separation of its cable assets. Paramount reaffirmed its offer and encouraged Warner Bros. Discovery shareholders to voice their preference for Paramount’s bid as it seeks to move forward with the transaction.
Both takeover bids are subject to regulatory scrutiny, given the potential industry impact of a change in ownership at Warner. Critics have raised concerns about market dominance if Netflix integrates Warner’s HBO Max platform, while highlighting the differences in scope between Paramount+ and Netflix. Warner Bros. maintains that the partnership with Netflix will benefit the entertainment industry overall.
The bids from Netflix and Paramount have sparked debates on the future of film and TV production. Notably, Paramount’s bid to acquire Warner’s cable networks and news business could lead to media consolidation and questions regarding editorial control. President Donald Trump has weighed in on the deal, hinting at potential political influences on regulatory decisions.
In a separate development, Affinity Partners, an investment firm linked to Trump’s son-in-law Jared Kushner, initially backed the Paramount bid but later withdrew its support. Trump’s personal sentiments and relationships with key industry figures, including Paramount CEO David Ellison’s father Larry Ellison of Oracle, have added intrigue to the bidding war. Trump’s public remarks underscore the complex dynamics surrounding the ongoing negotiations.