Warner Bros. Discovery Board to Review Paramount’s Enhanced Hostile Takeover Bid
Warner Bros. Discovery (WBD) is set to review an enhanced hostile takeover bid from Paramount Skydance. This revised offer includes new financial commitments aimed at acquiring all outstanding shares of WBD common stock.
Paramount’s Hostile Takeover Offer
On Tuesday, Warner Bros. Discovery confirmed receipt of the unsolicited tender offer from David Ellison’s Paramount Skydance. The company stated that its board of directors will analyze the proposal thoroughly. This evaluation will be in consultation with independent financial and legal advisors.
Key Points of the Review
- The board will consider the offer while adhering to WBD’s existing agreement with Netflix, Inc.
- For now, WBD will not change its recommendation regarding the Netflix Merger Agreement.
- Shareholders are advised against making any decisions regarding the Paramount Skydance offer at this time.
Details of the Amended Offer
Paramount has improved its hostile takeover offer. The bid is now set at $30 per share, totaling around $650 million in quarterly cash payments to WBD shareholders if the acquisition is delayed past December 31, 2026.
- Paramount also committed to covering a $2.8 billion termination fee to Netflix should WBD shareholders accept their offer.
- This amendment follows a strategic shift by Netflix, which recently increased its offer to $27.75 per share in an all-cash proposal worth $83 billion.
Timeline for Response
The WBD board has a deadline of 10 business days to respond to Paramount’s latest offer. The board’s decision will be shared with its stockholders after a comprehensive review of the proposal.
Background on Agreements
The original merger agreement between Netflix and Warner Bros. Discovery was announced on December 5. This deal notably excludes Discovery Global, which hosts WBD’s linear TV assets such as CNN, TBS, and HGTV, as well as Discovery+.
As this situation develops, all eyes will be on Warner Bros. Discovery’s response to Paramount Skydance’s enhanced hostile takeover bid.
