Hollywood studio Paramount isn’t going to let Netflix’s Warner Bros. acquisition go ahead without a bidding war. The historic filmmaking company announced an offer of its own for Warner Bros. today, which is even bigger than Netflix’s “inferior” proposal.
Paramount is offering $18bn more in cash than Netflix, according to a press release, and $30 a share rather than Netflix’s $27.5, and it’s bidding for the entire Warner Bros. company, including the Global Networks segment, which includes sports and news TV brands like CNN and TNT Sports. Netflix only wants the Streaming & Studios part, which includes Warner Bros. Motion Picture Group, DC Studios, and HBO, among others.
Paramount chairman and CEO David Ellison commented: “[Warner Bros.] shareholders deserve an opportunity to consider our superior all-cash offer for their shares in the entire company. Our public offer, which is on the same terms we provided to the Warner Bros. Discovery Board of Directors in private, provides superior value, and a more certain and quicker path to completion.”
The press release revealed that Paramount had submitted six buyout proposals to Warner Bros. over the course of 12 weeks, but apparently Warner Bros. “never engaged meaningfully with these proposals”. So Paramount has now taken its offer directly to shareholders and the board of directors “to pursue this clearly superior alternative”.
Paramount said it was “highly confident” in achieving regulatory clearance for its offer, too, which it described as “pro-consumer”. Paramount believes Netflix’s offer might stumble because of perceived video streaming monopoly. “The Netflix transaction creates a clear risk of higher prices for consumers, lower pay for content creators and talent and the destruction of American and international theatrical exhibitors,” Paramount said.
“We believe our offer will create a stronger Hollywood,” Paramount’s Ellison concluded. “It is in the best interests of the creative community, consumers and the movie theatre industry. We believe they will benefit from the enhanced competition, higher content spend and theatrical release output, and a greater number of movies in theaters as a result of our proposed transaction. We look forward to working to expeditiously deliver this opportunity so that all stakeholders can begin to capitalise on the benefits of the combined company.”
Netflix announced an $87.2bn deal to acquire Warner Bros. on Friday, which would see it also take charge of games studios such as Rocksteady, famed for the Batman Arkham series; NetherRealm, which makes Mortal Kombat; and Avalanche, which most recently made Hogwarts Legacy. Will the price tag now rise?
