Paramount rubbishes Warner Bros board’s appeal to shareholders about Netflix’s offer

NEW YORK & LOS ANGELES: Hollywood’s latest battle royale is heating up. Paramount, now owned by Skydance Corp, has fired back at Warner Bros Discovery’s board after they snubbed its $30-per-share all-cash takeover bid. The rejectionists, it seems, prefer Netflix’s embrace—but Paramount isn’t taking no for an answer.

David Ellison, Paramount’s chairman and chief executive, is positively bristling. His company reckons Warner Bros shareholders are being sold a pup by their own board, which recommended a rival Netflix deal that Paramount dismisses as lipstick on a pig. The numbers tell the story: Paramount offers cold, hard cash—$30 per share. Netflix? A measly $23.25 in actual money, plus stock that’s already trading below its “collar” and a stub of Warner Bros’ debt-laden Global Networks business that nobody can value. That’s an $18bn gap, by Paramount’s maths.

The Ellison offensive—backed by Larry Ellison’s family trust, bulging with over $250bn in assets including 1.16bn Oracle shares—has lined up $41bn in equity from the Ellisons and RedBird Capital, plus $54bn in debt from Bank of America, Citi and Apollo. No financing conditions. No ifs, buts or maybes.

What really gets Paramount’s goat is Warner Bros’ refusal even to engage. From mid-September through to early December, not a single negotiating session. Not even a marked-up contract. Warner Bros’ advisors, Paramount notes acidly, have worked with the Ellison trust before—on Twitter’s takeover, no less. Yet suddenly they’re playing coy, spinning a “kitchen sink” of concerns whilst failing to explain why they never bothered getting answers.

Warner Bros’ board hasn’t even determined whether Paramount’s bid “could reasonably be expected to lead to a superior proposal”—the contractual threshold that would let them properly consider it. Instead, they’re racing towards a shareholder vote on the Netflix deal, hoping Paramount will simply bugger off.

Fat chance. Paramount has launched a tender offer, urging Warner Bros shareholders to vote with their wallets now rather than wait months for a special meeting. The message is blunt: take the certain cash today, or risk being left holding Netflix stock and a toxic debt stub tomorrow.

Warner Bros shareholders will ultimately decide whether to trust their board’s Netflix romance or grab Paramount’s guaranteed payout. For now, Ellison and company are betting that when push comes to shove, thirty pieces of silver beats a streaming monopoly’s promise any day of the week.