Paramount wants to buy Warner Bros. What to know about hostile takeover bids

by

This week, Paramount made a move to acquire Warner Bros. Discovery, initiating a potentially fierce competition with Netflix. The offer was made without the consent of Warner Bros. Discovery’s management.

Paramount made an offer to buy all of Warner Bros. Discovery for $78 billion, paying $30 in cash for each share. This deal would include all of Warner Bros. Discovery’s properties, like CNN and the HBO Max streaming service.

Following Netflix’s $72 billion offer – $27.75 per share – to acquire Warner Bros. film and TV studios (including popular franchises like Batman, Bugs Bunny, and Harry Potter, along with the Burbank studio lot and HBO/HBO Max), Paramount made its own bid. Paramount claimed its offer was better and would result in a more powerful Hollywood studio.

Hollywood Inc.

Paramount offered $30 per share during the final stage of last week’s bidding process, but they didn’t receive a response, according to Paramount Chairman David Ellison.

Look, as a movie critic, I’ve been following this deal closely, and from what Paramount’s David Ellison is saying, it’s a win-win for everyone involved. He believes this move will actually boost creativity, give audiences more to choose from, and ultimately mean more movies hitting the big screen. He’s framing it as a positive shake-up, with increased competition and studios investing more in content – which, if true, sounds pretty good to me, and hopefully to moviegoers too.

Here’s what you need to know about the blockbuster fight:

What is a hostile takeover?

Paramount made a public offer to buy shares directly from Warner Bros. Discovery’s owners at a higher-than-usual price, but only for a limited time. If successful, this would give Paramount control of Warner Bros. Discovery.

Paramount highlighted that its offer of $30 per share in cash was 139% higher than Warner Bros. Discovery’s stock price of $12.54 on September 10th. They also pointed out that Netflix’s offer included both cash and company stock.

Paramount is now appealing directly to its shareholders, which also increases the pressure on Warner Bros. Discovery. This move comes after Paramount claimed Warner Bros. Discovery didn’t seriously consider their proposals over the past three months.

How has Warner Bros. responded and what is the deadline?

Warner Bros.’ board announced Monday that it’s reviewing Paramount’s offer to ensure it’s acting in the best interests of the company and will do so while following the terms of its agreement with Netflix.

The company’s board, with guidance from financial and legal experts, announced it will share a recommendation about the offer from Paramount within the next 10 business days. For now, they’re asking shareholders to hold off on making any decisions.

As a big fan, I’m keeping track of things, and it looks like Paramount’s offer to buy everything is set to end on January 8th at 5 p.m. Eastern time, unless they decide to give us more time, of course!

How often do these hostile takeovers succeed?

According to an analysis of LSEG data by The Wall Street Journal, about 29% of takeover attempts made since 2000, where multiple companies competed to buy the same target, actually succeeded.

In 2022, Elon Musk, the billionaire, began buying shares of Twitter, with the goal of taking over the company. He then offered to buy all of Twitter’s stock for $54.20 a share, which would have made the total purchase price around $43 billion. Twitter was later rebranded as X.

One example of a successful hostile takeover is when Royal Bank of Scotland acquired National Westminster Bank in 2000.

A notable failure was Valeant Pharmaceuticals’ attempt to buy Allergan, the maker of Botox, for $53 billion in 2014. Ultimately, Valeant withdrew its offer.

What could influence the results?

Netflix might make a new offer, but any deal still needs to be approved by the U.S. Justice Department.

During a recent event on Sunday, President Trump expressed concerns that Netflix’s deal might violate antitrust laws, noting that the company holds a significant market share and this “could be a problem.”

Jared Kushner, Donald Trump’s son-in-law, through his investment firm Affinity Partners, is helping to fund Paramount’s bid, alongside investors from Saudi Arabia, other Middle Eastern countries, and a company based in China.

When asked about a competing plan from Paramount at a White House event on Monday, Trump indicated he hadn’t made up his mind yet.

He stated he needs to find out their market share, adding that he isn’t close friends with any of them.

Read More

2025-12-10 14:37