Warner Bros Discovery has rejected a revised takeover approach from Paramount Skydance valued at about $30 per share, though it has granted the bidder one week to submit what it calls a “best and final” proposal. The decision signals the studio’s continued preference for its existing merger agreement with Netflix, even as rival interest intensifies.
In a letter signed by chairman Samuel DiPiazza Jr. and CEO David Zaslav, the company said Paramount’s proposal was not currently likely to result in a superior transaction. Paramount had informally floated a possible increase to $31 per share, but the board indicated it expects an offer above that level to reconsider its stance.
Paramount’s Latest Bid
Paramount’s latest bid values the entire company at roughly $108.4 billion, compared with Netflix’s $82.7 billion proposal, which targets only the studio and streaming divisions.
Warner Bros shareholders are scheduled to vote on the Netflix transaction March 20 after a planned spin-off of cable assets into a separate publicly traded entity. Those assets include channels such as CNN, TLC, Food Network, and HGTV.
Investor activism adding pressure
Ancora Holdings has built a stake in Warner Bros and plans to oppose the Netflix deal, while Pentwater Capital Management which owns about 50 million shares backs Paramount’s rival bid. Pentwater CEO Matt Halbower argues Paramount has addressed prior concerns raised by the board.
Financing certainty remains a sticking point. Paramount’s proposal includes backing from Larry Ellison, founder of Oracle and father of Paramount CEO David Ellison, who has pledged equity support. Still, Warner Bros cited unresolved questions about debt financing contingencies and potential fees tied to junior lien financing.
Regulatory scrutiny is also expected. Both bidders say they are in discussions with global competition authorities, including the U.S. Department of Justice, as antitrust concerns grow over pricing power and creative-industry impacts if either deal proceeds.