Will David Ellison move higher than Paramount Skydance‘s current $30-per-share offer for Warner Bros. Discovery? The company didn’t indicate that it is willing to increase the price tag for its hostile takeover bid, but said it was ready to start M&A talks in the seven-day negotiating window opened by WBD.
“Although the [Warner Bros. Discovery] Board’s actions are unusual, Paramount is nonetheless prepared to engage in good faith and constructive discussions,” the Ellison-led company said Tuesday.
“At the same time, we will continue to advance our tender offer, maintain our solicitation in opposition to the inferior Netflix merger, and proceed with our intention to nominate a slate of directors at the upcoming WBD annual meeting,” Paramount said.
Earlier Tuesday, Warner Bros. Discovery said it will engage in discussions with Paramount to “seek clarity” on its “best and final offer.” Specifically, the Warner Bros. Discovery board cited a communication from a “senior representative for PSKY” to an identified WBD board member that if the WBD board authorized M&A talks, Paramount “would agree to pay $31 per share and that the offer was not PSKY’s ‘best and final’ proposal.” In addition, WBD set March 20 for the special meeting of shareholders to vote on the Netflix deal — which the board currently still recommends that investors vote for.
WBD wants Paramount Skydance “to clarify your proposal, which we understand will include a WBD per share price higher than $31,” Warner Bros. Discovery CEO David Zaslav and board chairman Samuel Di Piazza Jr. wrote in a letter sent to Paramount’s board.
Paramount continued press its position that its $30/share proposal for WBD in its entirety is superior to Netflix’s deal to acquire WB’s studios and HBO Max.
The WBD board “elected to proceed with convening its special shareholder meeting on March 20 to seek approval of the Netflix merger and has commenced mailing its proxy materials, which state that the range of merger consideration offered to WBD shareholders will be a minimum of $21.23 to a maximum of $27.75,” Paramount said in its statement. “By contrast, Paramount already offers a higher value of $30 per share, all-cash and a more expeditious and certain path to closing a transaction,” including with the previously disclosed addition of a “ticking fee” of 25 cents per share payable per quarter to WBD shareholders for each quarter after Dec. 31, 2026, that a Paramount-WBD merger has not closed.
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Even as it opens the door to negotiations with Paramount, WBD’s board of directors “continues to unanimously recommend in favor of the Netflix merger,” the company said — and the board also unanimously recommends that shareholders reject Paramount Skydance’s most recent offer.
Paramount said that in opening the seven-day window for talks, WBD’s board “has chosen to avoid making the customary determination under the Netflix merger agreement that Paramount’s superior $30 per share all-cash offer ‘could reasonably be expected to result in’ a superior proposal, which would have given it an unfettered right to negotiate without a deadline.”
From Variety US