Paramount has increased its offer to buy Warner Bros. Discovery to $31 per share, up from its previous offer of $30 per share.
Warner Bros. said: Discovery’s board has not yet made a decision on whether the offer is better than Netflix’s, but says it is “reasonably expected” to result in a “superior offering for the company.” Netflix offered $27.75 per share for the company’s streaming and movie assets alone, in a deal worth $82.7 billion.
Paramount’s revised proposal includes not only a $31.00 purchase price increase per WBD share in cash, but also a daily recording fee payable to shareholders equal to $0.25 per quarter beginning after September 30, 2026, as well as a $7 billion regulatory redemption in the event the deal does not close due to regulatory matters. Paramount also agreed to pay the $2.8 billion termination fee that Warner Bros. will be required to pay. It pushed Netflix to terminate the existing merger agreement.
The signing fee schedule was originally scheduled to begin on December 31, and the $7 billion fee will be raised from the $5.8 billion fee the company proposed. The new timing of the signing fee and higher termination fee is intended to underscore Paramount’s confidence in its ability to get the deal through the regulatory process, and put pressure on Netflix.
However, the companies are still talking, suggesting that Paramount’s latest offer may not be the “best and last.” WBD said it wanted to get to that point in order to remove any doubt about Paramount’s willingness to raise, and Netflix’s ability to match.
If the board of directors of Warner Bros. Since Paramount’s offer is a “superior company offer,” Netflix will have four business days to negotiate with WBD and propose any modifications to its offer.
Paramount has launched a hostile takeover bid directly with shareholders as part of its efforts to back away from the previously agreed-upon $82.7 billion Netflix deal. This deal was first revealed in December and was amended to an all-cash offer in late January. Members of the board of directors of Warner Bros. gave Paramount has set a deadline of early this week to submit the best and final revised offer. Paramount’s bid includes all of Warner Bros., meaning it will also include linear cable networks like CNN, TBS, HGTV and TNT.
WBD has set a March 20 date for a vote on the Netflix deal, which means the clock is ticking to reach an outcome one way or the other.
Earlier this morning, Warner Bros. said: Its board of directors, along with financial and legal advisors, is reviewing Paramount’s latest new offer, but it has not disclosed the exact details of the offer. Paramount also confirmed the show but remained tight-lipped on the details.
