New York: Warner Bros Discovery has once again rejected a takeover bid from Paramount, urging shareholders to remain committed to a rival deal with Netflix as a high-stakes battle for control of the media company intensifies.
The company said that its board had determined Paramount’s latest offer was not in the best interests of Warner Bros Discovery or its shareholders. It reaffirmed its recommendation that investors support the proposed sale of Warner’s studio and streaming business to Netflix in a deal valued at $72 billion.
Paramount, which is backed by Skydance Media, has taken its bid directly to shareholders with a hostile offer valued at $77.9 billion for the entire company. The move follows weeks of repeated approaches that Warner leadership has consistently rebuffed.
Warner raised fresh concerns about the structure of Paramount’s proposal, pointing to heavy reliance on debt financing and the risks this could pose to completing the transaction. The company said those risks outweighed the higher headline value of the offer.
Paramount has sought to strengthen its bid in recent weeks. It announced a personal financial guarantee from Oracle founder Larry Ellison to support more than $40 billion in equity financing. The company also raised the breakup fee payable to shareholders if regulators block the deal, matching the protections already offered under the Netflix agreement.
In a letter to shareholders, Warner said it views Paramount’s proposal as resembling a leveraged buyout that could take up to 18 months to close. The company warned that prolonged regulatory reviews and financing uncertainty could weigh on shareholder value.
The competing bids reflect sharply different strategies. Netflix is seeking only Warner’s studio and streaming assets, including its film and television production units and platforms such as HBO Max. Paramount, by contrast, wants to acquire the entire company, including Warner’s news and cable networks such as CNN and Discovery.
Under the Netflix proposal, Warner’s news and cable operations would be spun off into a separate company, in line with a previously announced restructuring plan.
Any merger involving Warner is expected to face intense regulatory scrutiny due to the size and influence of the businesses involved. A review by the US Justice Department is considered almost certain, with regulators potentially seeking major changes or moving to block a deal altogether. Overseas regulators could also raise objections.
