Paramount insists it’s offering a higher deal than Warner Bros. deal Discovery of Netflix

Paramount continued Thursday to insist that it had made a higher offer for Warner Bros. Discovery, compared to that of Netflix, despite the reluctance of the WBD board of directors.

Netflix agreed last year to acquire Warner Bros.’ film and television studios and streaming platform. Discovery, HBO Max, in cash and stock deal valued at $27.75 per Warner Bros. share Paramount, a Skydance company, then launched a hostile takeover bid for all of Warner Bros. Discovery, including the cable assets left behind by Netflix.

WBD Chairman Samuel A. Di Piazza Jr. on Wednesday reiterated the board’s recommendation in favor of the Netflix deal and recommended shareholders reject Paramount’s offer. This angered Paramount, which issued a press release suggesting that the concerns raised by WBD had been addressed in an amended proposal.

WARNER BROS DISCOVERY BOARD UNANIMOUSLY REJECTS PARAMOUNT TAKEOVER OFFER, DECLARES NETFLIX DEAL TOP

“Paramount resolved all of the issues raised by WBD on December 17, including providing an irrevocable personal guarantee from Larry Ellison for the equity portion of the financing. However, WBD continues to raise issues in Paramount’s offer that we have previously addressed, including the flexibility of interim operations,” Paramount said in a press release.

“Paramount’s offer is superior to the existing agreement between WBD and Netflix and represents the best path forward for WBD shareholders. $30.00 per share in cash is easy to value. The Netflix transaction, on the other hand, contains multiple uncertain elements and its total value has already declined,” the statement continued. “When announced in December, the Netflix transaction offered WBD shareholders $23.25 in cash, $4.50 in Netflix stock, and a share in the pending Discovery Global spinoff. Today, Netflix’s stock price is trading well below the low end of its threshold, reducing the value offered to WBD shareholders.”

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Warner Bros. Discovery announced that its board of directors had unanimously rejected Paramount’s takeover offer. (Mario Tama/Getty Images/Getty Images)

Paramount added that WBD’s board has not “disclosed any analysis to help its shareholders value their potential continued ownership of the linear segment,” noting that Versant Media is “its closest comparable,” which “illustrates the difficult road ahead” for Discovery’s cable assets.

Paramount CEO David Ellison also released a statement saying his company’s offer was superior.

“Our offering clearly provides WBD investors with greater value and a more certain, quicker path to completion. Throughout this process, we have worked hard for WBD shareholders and remain committed to engaging with them on the merits of our superior offering and advancing our ongoing regulatory review process,” Ellison said.

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Netflix agreed last year to acquire Warner Bros.’ film and television studios and streaming platform. Discovery, HBO Max, in cash and stock deal valued at $27.75 per Warner Bros. share (Anna Barclay/Getty Images/Getty Images)

Di Piazza Jr. previously insisted that Paramount’s offer was “inferior.”

“The board unanimously determined that Paramount’s latest offer remains inferior to our merger agreement with Netflix in several key areas,” Di Piazza said.

“Paramount’s offer continues to provide insufficient value, including terms such as an extraordinary amount of debt financing that creates closing risks and a lack of protection for our shareholders if a transaction is not completed,” Di Piazza continued. “Our binding agreement with Netflix will deliver superior value with higher levels of certainty, without the significant risks and costs that Paramount’s offer would impose on our shareholders.”

Warner Bros. Discovery did not immediately respond to a request for comment.

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