Paramount’s offer covers $2.8bn Netflix break fee
Well, Warner Bros. Discovery is considering reopening negotiations with Paramount Skydance Corp. and according to Bloomberg, many people cited that this move could reignite a high-stakes contest.
Board members are curious to know whether Paramount can offer a superior deal, or if it’s all talk.
Netflix’s break fee and WB’s debt are eyed by Paramount’s revised offer.
Paramount’s revised offer attempts to resolve some of the hostile issues that delayed the negotiations earlier.
If Warner Bros. is to walk away from Netflix, Paramount is ready to cover the $2.8bn termination fee. Also, it stated that it’ll be compensating the shareholders if the deal is still nowhere by 31st Dec 2026. This showed the confidence that Paramount has in regulators in passing the transaction in their favor.
Although WB still has a tad foggy mind of Paramount’s approach, the latest shift has altered the internal system assessment. It seems that for the first time, they began to process Paramount’s offer for their betterment, and also pressured Netflix to improve.
Both parties have hinted at raising their bids if needed.
Staying locked on the Netflix transaction, WBD is facing growing pressure from shareholders to explore other alternatives before it.
Albeit, co-chief investment officer at Gabelli Funds, Chris Marangi, was a tad disappointed with Paramount for not raising their offer, the latest changes to the terms suggest the company is trying to do something creative about the bid. Chris, whose company owns Warner Bros. shares, said, “Like the Warner Bros. board, I want to see a sweetened offer.”
In one way, WBD can’t quietly reopen talks with Paramount because the agreement with Netflix controls what happens next, giving them the right to respond.
David Ellison, Paramount CEO, has stated that the current offer isn’t his final bid, and Netflix’s leadership has told shareholders that it won’t be backing out either.
Meantime, Warner Bros. Discovery is fast-tracking a shareholder vote to approve its deal with Netflix.
But then, totally in an unprecedented manner, Paramount’s amended offer has introduced a new variable into the bid war. Who will win, Netflix or Paramount, is yet to be seen!?
Either way, the latest update tells us the bid war is far from over!
Pic Credits: WB/Google
