Bengaluru — Paramount Skydance launched a hostile $108.4bn bid on Monday for Warner Bros Discovery (WBD), in a last-ditch effort to outbid Netflix and create a media powerhouse that would challenge the dominance of the streaming giant. Netflix emerged victorious on Friday from a weeks-long bidding war with Paramount and Comcast, securing a $72bn equity deal for WBD’s TV, film studios and streaming assets. But Paramount’s latest attempt means the jockeying for WBD and its prized HBO and DC Comics assets will not come to a conclusion swiftly.
Netflix’s offer comes with a $5.8bn break-up fee and is likely to face strong antitrust scrutiny. US President Donald Trump raised questions about the offer over the weekend. The bid has already drawn sharp criticism from bipartisan legislators and Hollywood unions on concerns that it could lead to job cuts and higher prices for consumers.
However, Paramount’s bid could also face scrutiny. A Paramount-WBD combination would boost its dominant position in the studio business, which some worry could lead to job losses as the industry rapidly consolidates. Reuters had already reported, citing sources, that Paramount raised its offer to $30 a share on Thursday for the entire company, but that the WBD board had concerns about the financing.
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Paramount submitted multiple offers starting in September to forge an entertainment powerhouse capable of challenging Netflix and tech giants such as Apple that have expanded into media. However, it faced rejections. Paramount remains one of Hollywood’s major studios but its box office record has been uneven, with occasional franchise wins offset by periods in which its slate has trailed Disney, Universal and WBD in US market share.
It had sent a letter to WBD, questioning the sale process and alleging the company has abandoned a fair bidding process and predetermined Netflix as the winner. That followed reports that WBD’s management called the Netflix deal a “slam dunk” while speaking negatively about Paramount’s offer. In an interview with CNBC on Monday, Paramount CEO David Ellison said there is an “inherent bias” against his company in the bidding.
“We will be the largest investor in this deal. We’re literally sitting here today because we are fighting for our shareholders, and we’re also fighting for the shareholders of WBD.” Bloomberg News has reported Trump met Netflix co-CEO Ted Sarandos in mid-November, telling the executive that WBD should sell to the highest bidder. Morningstar analysts have said the combined Netflix-WBD would have substantial overlap and its combined streaming revenue would decline unless Netflix doubles its prices or runs separate platforms, neither of which the brokerage expects.
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