Paramount stands by bid for Warner Bros. Discovery

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Paramount continues to pursue its offer of $30 per share to buy Warner Bros. Discovery, and is once again reaching out directly to the company’s shareholders to gain their support.

This decision follows a unanimous vote by Warner Bros. Discovery’s board to turn down the latest offer from Paramount. The revised bid included a personal guarantee from billionaire Larry Ellison to cover the financing portion related to his son’s company.

Paramount Skydance responded to Warner Bros. Discovery’s concerns about debt on Thursday by highlighting the benefits of their offer: a straight $30 per share cash payment for the entire company, including popular channels like CNN, HGTV, TBS, and Animal Planet. They essentially argued the offer’s value should be clear.

Warner Bros. directors argue that Netflix’s offer of $27.75 billion in cash and stock is better because Netflix is the financially stronger company. Warner also points out that canceling their agreement with Netflix, signed on December 4th, would result in significant costs, including a $2.8 billion penalty.

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Warner Bros. Discovery’s board wasn’t convinced by Larry Ellison’s offer to personally guarantee funding for Paramount’s offer. They continue to strongly support the agreement with Netflix.

The leading streaming service will now own HBO, HBO Max, and Warner Bros.’ movie and TV production studios. As a result, Warner plans to create a new, independent company focused on its traditional cable networks later this year.

The uncertain worth of Warner’s cable channels is a major sticking point in the company’s sale negotiations.

In a statement released Thursday, Paramount CEO David Ellison emphasized that their offer delivers more value and a faster, more secure route to finalizing the deal for Warner Bros. Discovery investors. Paramount also announced they’ve addressed all of Warner’s previous concerns, particularly by securing a firm, personal guarantee from Larry Ellison to cover the financial investment.

I’m following this closely, and it looks like Paramount is hoping Warner Bros. Discovery shareholders will consider their offer and sell their stock to them. Right now, those shareholders have until January 21st to decide, but Paramount might give them more time if needed.

Netflix is offering Warner shareholders a deal that includes $23.25 in cash, $4.50 worth of Netflix stock, and shares in Discovery Global, a new cable channel company Warner plans to launch this summer.

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Netflix is interested in acquiring Warner Bros. and HBO, but Paramount Global is also making a competing offer, even an unwelcome one. Here’s a look at how things have unfolded so far.

Earlier this month, Comcast created a new company called Versant by spinning off several of its cable channels, including CNBC and MS NOW. Since then, Versant’s stock price has fallen significantly, dropping around 25% from its initial price of $45.17 on Monday to about $32.50 on Thursday. Versant has explained that this initial drop was expected, as large investment funds adjusted their holdings.

Paramount claims that changes in Netflix’s stock price negatively impact the value of their deal with Netflix.

Ellison stated that they have been diligently working to deliver value for Warner Bros. Discovery shareholders and are continuing to discuss the benefits of their offer while also working through the required regulatory approvals.

Paramount is receiving financial support from investors in the Middle East, including Saudi Arabia, and is borrowing money from Apollo Global. Warner Bros. Discovery stated that the $94 billion deal to acquire Paramount would be the biggest leveraged buyout in history.

Despite the ongoing negotiations, Paramount and Warner Bros. Discovery stocks remained stable on Thursday. Paramount was trading at approximately $12.36 per share, and Warner shares were around $28.50.

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This decision follows recent talks where Paramount, controlled by Larry Ellison and his family, made an offer to purchase all of Warner Bros. Discovery.

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2026-01-08 20:31