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Warner Bros. Discovery said Paramount raised the price of its takeover offer to $31 a share, potentially setting the stage for a new bidding war with Netflix over the Hollywood giant’s future.
The company previously offered $30 per share when it first went directly to Warner shareholders with its hostile cash offer in December, just days after Warner struck a deal to sell its studio and streaming business to Netflix for $27.75 per share.
In addition to increasing the proposed purchase price, Warner said Tuesday afternoon that Paramount had increased its regulatory termination fee to $7 billion. Paramount also agreed to increase a previously promised “ticking fee” to be paid to shareholders if the deal doesn’t go through now by the end of September – to the tune of 25 cents per share, or a total of $650 million.
After briefly resuming talks with Paramount, Warner previously confirmed that the company had received a revised offer and was reviewing it. When announcing the increased price, Warner said that Paramount’s revised proposal “could reasonably result in a better offer within the spirit of the current agreement with Netflix” – but the company’s board has still not decided whether Paramount’s offer is better than Netflix’s.
When reached Tuesday afternoon, a Netflix spokesperson declined to comment.
Possible redesign of the media landscape
A takeover of Warner Bros. Discovery would reshape Hollywood and the entire media landscape – with HBO Max and cult favorite titles like Harry Potter and depending on who wins the tug-of-war between Netflix and Paramount, possibly even CNN under a new umbrella.
Paramount wants to completely take over Warner Bros. – including channels like CNN and Discovery. But Netflix only wants to buy Warner’s studio and streaming business. Warner’s board has repeatedly supported that deal and said Tuesday that its agreement with Netflix remains in place.
However, if Warner’s board later considers Paramount’s offer to be superior, Netflix would then have four days to match or revise its offer. It could also choose to walk away.
“Are we going to lose HBO?” Cultural critics Teri Hart and Bilge Ebiri join host Elamin Abdelmahmoud on Commotion to discuss the largest studio merger in history (Netflix and Warner Brothers) and its potential impact on consumers and the cinema and streaming landscape.
Paramount, Warner and Netflix have been arguing heatedly in recent months over who has a stronger deal. But many lawmakers and entertainment groups have now sounded the alarm, warning that a takeover of all or part of Warner’s business would only further consolidate power in an industry already run by just a few major players. Critics say it could lead to job losses, less diversity in filmmaking and potentially more headaches for consumers already facing rising streaming subscription costs.
Taken together, this raises huge antitrust concerns – and a sale of Warner could come down to who gets the green light from regulators. The US Department of Justice has already launched reviews and other countries are expected to do the same.
Both Paramount and Netflix have argued that their proposals are good for consumers and the industry as a whole. And the companies have publicly targeted each other with regulatory arguments.
Paramount has pointed to Netflix’s much larger market value. And it is argued that the streaming giant’s acquisition of Warner would only give it greater dominance in the subscription video-on-demand space.
But Netflix is
Although CBS postponed the broadcast of a 60 Minutes story about El Salvador’s CECOT prison, the segment briefly appeared on Global TV’s free website and app. The story’s pulling sparked controversy after CBS News editor-in-chief Bari Weiss sought to include the Trump administration’s perspective in it.
Politics could also come into play. US President Donald Trump previously made unprecedented suggestions about his involvement in implementing a deal, but walked back those statements and insisted that regulatory approval would be the responsibility of the Justice Department.
Trump has a close relationship with billionaire Oracle founder Larry Ellison (the father of Paramount Skydance CEO David Ellison), who strongly supports Paramount’s bid to buy Warner. And the push to acquire Warner came just months after Skydance completed its own takeover of Paramount – in a controversial merger that was approved just weeks after the company’s founding agreed to pay the president $16 million to resolve a dispute over editing at Paramount 60 minutes program on CBS.
Under the new ownership, CBS underwent significant editorial changes, most notably with the appointment of Free Press founder Bari Weiss as editor-in-chief of CBS News. Critics say similar changes could occur at Warner’s CNN if Paramount’s bid is successful.
Yet Trump has continued to publicly criticize Paramount over editorial decisions at CBS. 60 minutes. The president also previously met with Netflix co-CEO Ted Sarandos, whom he called a “fantastic man.”
