Warner Board Poised to Urge Shareholders to Reject Paramount Bid as It Backs Netflix Deal

Overview

• Warner Bros. Discovery is preparing to recommend a rejection of Paramount Skydance’s hostile offer, reported at $30 per share for the whole company, according to the Wall Street Journal.
• The board previously said it would review Paramount’s proposal within 10 business days while maintaining a positive recommendation for the Netflix agreement.
• Warner announced an agreement to sell its film and TV studios and HBO Max to Netflix for roughly $27.75 per share, or about $72 billion, which the board views as higher-value and more certain.
• Warner’s deliberations raised concerns about the revocable nature of the Lawrence J. Ellison Revocable Trust and the absence of a personal guarantee, even as Paramount cited $40 billion in equity commitments from the trust and RedBird with additional partners.
• Netflix outlined financing that includes more than $10 billion in cash and equity plus bank loans and the assumption of nearly $60 billion of WBD debt, while antitrust scrutiny continues as the WGA opposes the deal and U.S. senators have asked the DOJ to review it.