Hollywood
Warner Bros board reopens talks after Paramount raises bid to $31 a share
Netflix has four days to revise $27.75-a-share proposal
NEW YORK: The board of Warner Bros Discovery has reopened talks with Paramount Skydance after the rival bidder raised its cash offer to $31 a share, intensifying a takeover contest for one of Hollywood’s most prized studios, Reuters reported.
Paramount’s revised proposal has pulled Warner Bros’ directors back to the negotiating table, even as Netflix risks losing its status as the preferred suitor. The board said it had not yet concluded whether Paramount’s offer was superior to the Netflix deal, but confirmed it would engage further with both sides. Should a higher bid emerge, Netflix has four business days to respond.
In a bid to strengthen its hand, Paramount increased the termination fee payable if regulators block the deal to $7 billion, up from $5.8 billion. It also agreed to pay Warner shareholders 25 cents a share per quarter for every quarter beyond 30 September that the transaction fails to close. Paramount further offered to inject additional equity should lenders raise concerns about financing at completion.
Paramount’s $31-a-share bid is an all-cash offer for the entire company. Netflix, by contrast, has proposed $27.75 a share in cash, valuing the deal at $82.7 billion including net debt, for Warner’s film and television studios, content library and the HBO Max streaming platform.
The comparison is muddied by structure. Warner plans to spin off its television networks into a separately listed company, Discovery Global. The ultimate value of Netflix’s offer therefore depends on the spun-off unit’s debt load and market valuation. The board estimates Discovery Global could trade between $1.33 and $6.86 a share, potentially lifting overall shareholder returns above Paramount’s earlier $30-a-share proposal.
Either outcome would reshape Hollywood’s balance of power, handing the winner a deep content vault and enduring franchises including Game of Thrones and DC Comics. Netflix has ample cash to raise its offer, while Paramount argues it faces fewer regulatory hurdles in the United States. It has also signalled readiness to mount a board challenge at Warner’s annual meeting if its proposal is rejected.
That pressure is building. One potential director nominee floated by Paramount is Pentwater Capital Management chief executive Matthew Halbower, one of Warner’s largest shareholders. Separately, activist investor Ancora Holdingshas accused the board of insufficient engagement with Paramount.
Warner is due to report quarterly results this week, which may shed more light on the value of its cable television assets. Paramount reports earnings on Wednesday. A shareholder vote on the Netflix deal is scheduled for 20 March.
Hollywood
UK watchdog CMA to probe Warner Bros-Paramount merger deal
Phase 1 review to assess competition risks as industry voices opposition
LONDON: The Competition and Markets Authority is set to launch a preliminary investigation into the proposed $110 billion merger between Warner Bros Discovery and Paramount, marking the first formal regulatory step in assessing the deal’s impact on competition.
The UK watchdog has initiated a consultation process with industry stakeholders, inviting comments until April 27. This phase, known as a Phase 1 review, will evaluate whether the merger could harm competition across the film and television sectors, both of which play a significant role in the UK economy.
“We expect to launch our phase 1 investigation in the coming weeks,” said Competition and Markets Authority spokesperson, in an emailed statement to Reuters. “The film and TV industries contribute billions to our economy, so it’s important we assess whether deals between studios may harm competition.”
The proposed transaction, which also involves Skydance Media, would bring together two of Hollywood’s largest studios, combining extensive content libraries and potentially reshaping the global entertainment landscape.
Following the initial assessment, the regulator will decide whether to escalate the matter to a more detailed Phase 2 investigation, which typically involves deeper scrutiny of market dynamics and competitive risks.
The deal is already facing growing resistance from within the creative community. More than 1,000 industry professionals, including Jane Fonda, Mark Ruffalo and Ben Stiller, have publicly opposed the merger, warning it could reduce opportunities, limit storytelling diversity and place further strain on an industry still adjusting to rapid change.
As regulators begin to weigh the implications, the proposed merger is shaping up to be a defining test of how far consolidation can go in a media industry already in flux.
