Paramount Skydance Boost Bid For Warner Bros. Discovery

In an effort to outbid rival Netflix, Paramount Skydance has raised the stakes in the bidding war for Warner Bros. Discovery and its broadcast and cable TV assets, according to a Reuters report on Monday. This comes after Netflix’s co-CEO Ted Sarandos had an appearance on the BBC programme yesterday in an attempt to defend the Netflix offer.

The nature of the bid revision was not immediately apparent. While Netflix was not immediately reachable, Warner Bros. and Paramount declined to comment.

The bid, which increases its prior offer of $30 per share, was made in response to a deadline set last week by Warner Bros. Discovery’s board with Netflix’s consent.

The conflict over Warner’s assets has turned into a political one in which the US. President  Donald Trump threatened to “face the consequences” if Netflix did not remove Democratic foreign policy expert Susan Rice from its board on Saturday.

In a response to the US president, Netflix CEO Ted Sarandos said on Monday on BBC Radio 4 that Trump “likes to do a lot of things on social media” as this tends to be a commercial transaction. It’s not a political agreement. The US Department of Justice oversees this agreement, as do regulators in Europe and other countries alike.

Sarandos refused to comment on how Netflix would react to a greater offer from Paramount in an interview with another sister press media two days prior. He went on to acknowledge the fact that Netflix has a “rich history” of being “willing to walk away and let someone else overpay for things.”

“It’s up to someone else to make the next move in respect to the offer, as Warner Bros. Discovery has a contractual contract with us,” Sarandos stated. Sarandos went on further to say that “we’ll see what happens in the future if someone wants to make a better deal, which the Warner Bros. Discovery board has stated it hasn’t happened yet.”

However, Warner Bros. Discovery will have to pay Netflix a $2.8 billion breakup fee if it accepts Paramount Skydance’s updated offer.

In light of this, Warner Bros. Discovery announced last week that its board would hold talks with Paramount Skydance, under the leadership of David Ellison, to “seek clarity” on Paramount’s “best and final offer” in its hostile acquisition effort, as the business opened a seven-day window for the firm to enhance its offer.

As it stands now, the revised bill has increased the total valuation of the offer values of WBD to approximately $108.4 billion. Also, to incentivise a swift close, Paramount recently introduced a fee of 25 cents per share ($650 million) for every quarter the deal remains uncompleted after 2026, starting in 2027.