Warner Bros likely to reject nearly $140b Paramount bid, back Netflix in bidding war, sources say

LOS ANGELES – Warner Bros Discovery’s board could announce a decision as early as Dec 17 on Paramount Skydance’s US$108.4 billion
(S$139.7 billion)
takeover bid
, with the board likely to advise shareholders to vote against the offer, according to sources familiar with the matter.

The decision to recommit to Netflix’s buyout offer
would mark the latest twist in the race for assets that include Warner Bros’ storied film and TV studio, and its extensive film and television library.

Its portfolio includes classics from Casablanca and Citizen Kane to contemporary favourites like Harry Potter and Friends, HBO and the HBO Max streaming service.

The winner will gain a big advantage in the streaming wars by locking up a deep content library that has long been an acquisition target.

Netflix earlier in December emerged victorious with a US$27 cash-and-stock bid for Warner Bros’ non-cable assets.

Paramount chief executive David Ellison then went directly to Warner Bros’ shareholders with a US$30-a-share, all-cash bid for the whole company.

In regulatory filings, Paramount has said its bid is superior to Netflix’s and would enjoy a clearer path to regulatory approval.

Its offer is financed by US$41 billion in new equity, which is backed by the Ellison family and RedBird Capital, and US$54 billion of debt commitments from Bank of America, Citi and Apollo.

Mr Jared Kushner’s Affinity Partners, which was one of Paramount’s financing partners, is exiting the battle, according to Bloomberg. REUTERS