Paramount Skydance have raised their bid for Warner Bros. Discovery amidst rising pressure to make a merger decision.
The battle for Warner Bros. Discovery looks much like a kid stuck in the middle of a custody battle, except Netflix and Paramount were never married, the kid’s adopted, and they’ve got buckets of money.
The Warner Bros. Discovery board of directors announced yesterday that Paramount have revised their bid, increasing the purchase price to $31 per WBD share.
The announcement comes as the latest attempt to out-do Netflix’s acquisition deal with Warner Bros. Netflix first announced the agreement in December, offering to buy the Warner Bros Studio and HBO Max for $27.75 per share, totalling $108 billion.
Paramount swooped in with a counter-offer; not just the studio and streaming rights, but the linear cable channels and TV production, agreeing to pay the $2.8 billion termination fee to Netflix for cancelling the merger agreement, and to pay off SBD’s $33 billion debt.
Paramount’s deal totals a whopping $111 billion (is now a good time to mention it would cost $70 billion to solve global poverty?)
Warner Bros have remained publicly impartial, even whilst Paramount puts the pressure on. The WBD board has said that there is no guarantee “any definitive agreement or transaction” will come from further discussions with Paramount.
It seems Paramount is growing impatient with just discussions, implementing a “ticking fee” which raises the price of shares by $0.25 per quarter.
Many fear the Netflix takeover of WBD will kill an already suffering cinema industry. Cinema admissions are already on the decline, with Netflix’s notoriously short release windows further damaging the industry. Instead, attention would be shifted to straight-to-streaming productions of varying quality.
Additionally, by absorbing the prestige television productions of HBO into Netflix, creative voices would be swept up into the homogenous Netflix style, which ironically, first intended to be in direct opposition to HBO.
The Warner Bros. Discovery board will vote on March 20 on if the Netflix merger will remain in place.
