Paramount Skydance launched a hostile all cash tender offers to buy Warner Bros Discovery. The offer values the company at about $108.4 and sets a price of $30 per share.
Paramount says its all cash offer is higher than the deal Warner Bros Discovery recently agreed with Netflix. Paramount argues that shareholders would get more cash now and face less uncertainty about stock value under its proposal.
Deal Details
Paramount is making a direct approach to Warner Bros Discovery shareholders with an offer backed by debt commitments and equity support. The Ellison family and private partners and banks are part of the financing picture according to public filing summaries. Paramount has framed its move as a clearer and cleaner cash alternative to the mixed cash and stock offer from Netflix.
The move escalates a bidding contest that had appeared to close when Warner Bros Discovery and Netflix reached a deal. Paramount says the target board is pursuing an inferior proposal and so Paramount is taking its pitch straight to shareholders. That step makes this a hostile tender offer.
What Comes Next
Warner Bros Discovery will have to consider the new proposal versus the deal that it had with Netflix. The existing deal with Netflix includes terms for closing and break fees if the sale does not complete. Regulators will also look at any larger combination of major studios and streaming services for competition concerns. Market watchers expect a review of shareholder letters legal filings and the financing terms in the coming days.
This contest shows how high the stakes are for studio assets and streaming distribution. Paramount says its all cash offer gives shareholders immediate value and a simpler path than a mixed cash and stock deal. Netflix holds a competing deal that covers WBD studios and streaming operations. The final outcome will depend on shareholder response and any legal or regulatory hurdles the offers trigger.