Netflix bows out!
After a months-long war, there’s a winner in this Warner Bros. Discovery bid war… has it!?
Hmm…mmm…Paramount Skydance has emerged at the top to acquire Warner Bros. Discovery, challenging the streaming giant, Netflix, at every turn & corners.
Yeah, Netflix decided to bow out, citing financial discipline and saying the deal was not worth pursuing at a higher valuation, in its LinkedIn post.
In an official statement with Reuters, the streaming giant stated, “We’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive.”
WBD board still gotta terminate the agreement with Netflix, officially, and has to approve Paramount’s “Superior Proposal” yet. And that’s not it. The regulatory approvals and final paperwork are still pending before the deal closes.
David Zaslav, WBD CEO, has stated that the Paramount merger agreement would create significant shareholder value.
This merger would fuse the two major film studios, and streaming platforms, HBO Max and Paramount+, and news operations, including CNN and CBS.
The battle has been won, but the war is not over, yet!
The deal will face antitrust scrutiny in several U.S. states and overseas, although reviews in California and Europe may not pose serious hurdles. Some Democratic senators think that political considerations could influence the approval process.
Paramount, in its revised proposal, increased the termination fee of $5.8 billion to $7 billion if the deal were to fail. Also, it agreed to cover WBD’s $2.8 billion breakup fee, which it owes to Netflix.
Moreover, Larry Ellison has guaranteed $45.7 billion in equity, along with additional funding to meet solvency requirements. Bank of America Merrill Lynch, Citi, and Apollo have agreed to provide $57.5 billion in debt financing, upped from the earlier $54 billion commitment.
This outcome surely marked an unprecedented turn in one of Hollywood’s most closely watched takeover battles. Now, the battle has been won, but the war to own it is still raging on! So now, all the eyes and ears are on the decisions from the regulators.
Pic Credits: LAT/CNBC/Google/LI
