The affair has occupied the cultural industry for two months now. Last December, Netflix announced its intention to Buy Warner Bros for more than 82 billion dollars. The operation should shake up the entertainment sector on a global scale, in that it changes the balance of power in the field of SVoD and exhibition cinema. But now, if the two parties quickly agreed on a marriage, a rejected company is struggling to let go of the affair. Paramount Skydance was also in the race, but did not win its case with WBD and its board of directors. David Ellison’s firm has since multiplied interference, in the form of hostile takeovers or complaints. So much so that the smooth running of operations is now threatened?
Paramount takes out the checkbook
Paramount has no intention of admitting defeat. A few weeks after Netflix made a new all-cash offer (previously against cash and shares), David Ellison’s company went up. It offers Warner Bros shareholders an additional $650 million for each additional quarter if the deal is not finalized before December 31, 2026. She believes that the transaction is more likely to be validated by the regulatory authorities than the agreement between Warner Bros and Netflix.
At the same time, Paramount agrees to pay a termination fee of $2.8 billion to Netflix in the event of termination of the agreement with Warner Bros. In the same movement, the Skydance group is offering to pay up to $1.5 billion in fees related to its debt exchange offer. Paramount Skydance is multiplying the financial arguments to bend the red N and convince shareholders that its proposal is the most interesting… and safe.
In addition to this, the group is extending the expiration date of its takeover offer. It now extends until March 2, 2026. Warner Bros must hold an extraordinary general meeting at the end of March or the beginning of April to vote on the agreement with Netflix.
Warner Bros. maintains its course
If the parent company of HBO and Warner Bros Studios will consider Paramount’s new proposal, its allegiance remains the same. The company’s position is unchanged, it continues to recommend that its shareholders approve the deal with Netflix. To date, WBD’s board of directors has rejected eight acquisition proposals from Ellison. As a reminder, Paramount’s revised offer is valued at $108 billion ($30 per share) with an equity contribution of $43.6 billion from Larry Ellison (father of David Ellison).
For its part, Netflix wants to pay $27.75 per share. Unlike the proposal made by Paramount Skydance, the Red N’s offer does not concern the entire conglomerate. It must therefore take shape after the split of Warner Bros and Discovery assets. The latter must be finalized by mid-2026 and thus help speed things up.
What impact for customers?
A takeover of Warner Bros by Netflix, or by Paramount Skydance, worries regulators. With the strength of HBO max, currently number 4 in the streaming sector, Netflix would further distance itself from its competitors. Facing the American Senate, Ted Sarandos argued last week that the risk of monopoly should be ruled out. According to its estimates, 80% of HBO Max subscribers are also Netflix subscribers. The increase in its market shares would therefore be less.
The objective stated by the CEO is clear: “we “We will offer consumers more content at a lower cost”. Precisely, this question of cost occupies a significant part of the argument of Netflix’s detractors. Sarandos provides an answer that risks setting a few jaws. “If the consumer thinks it’s too expensive for what it is, they can cancel with just one click.” Not sure that the argument will sway the authorities in favor of a takeover by Netflix. Next step therefore, the end of Paramount’s public buyout offer (March 2) and the vote of Warner Bros. shareholders. In its purchase offer, the N rouge announced that it hoped to conclude the transaction within 12 to 18 months. A deadline that brings the verdict at the beginning of 2027.
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