Despite the letters, the wooing, the appeals directly to shareholders, and possibly the wine and the chocolates, Warner Bros. Discovery is still going to decline Paramount and go with Netflix, hostile takeover bid or not.
Bloomberg reports that the Netflix bid is still favored due to a number of factors. The Netflix deal, according to the board, offers greater value, certainty, and better terms than the Paramount deal.
The Paramount deal is backed, in part, by cash from a revocable trust that manages the wealth of Paramount Skydance boss David Ellison’s father, Oracle supremo Larry Ellison. In this kind of trust, assets can be withdrawn at any time, so this introduces uncertainty.
The board also says that Paramount isn’t “offering the company enough flexibility to run its business or manage its balance sheet” while the deal goes through and clears regulatory hurdles.
WBD will file an official response rejecting the deal as early as tomorrow.
This comes on the back of news that Jared Kushner’s Affinity Partners investment firm is no longer part of the Paramount bid, despite them being named last week alongside three Gulf wealth funds.
