We told you this was going to be a soap opera. This thing is unfolding like an episode of Succession, but with less laughs. Paramount Skydance are mounting a hostile takeover for Warner Bros. Discovery.
You know the story by now, that WBD chose Netflix as their new Daddy, despite Paramount Skydance being considered the favourite.
Well, being the scion of one of the worlds richest men obviously comes with supremes levels of confidence, as David Ellison isn’t going to back down.
Screw you, and your board, is his message, as he takes his offer direct to shareholders showing how it is better.
It is an all-cash tender offer to acquire Warner Bros. Discovery for $30 per share, and it is for all of WBD, not just the studio and streamer like Netflix.
Netflix is offering $72 billion, and then due to the spin off of Discovery an enterprise value of $82.7 billion.
Paramount says their offer is worth an enterprise value of $108.4 billion, includes assumption of debt, and has a clearer path to regulatory approval.
So the battle lines are drawn. Netflix vs. Paramount Skydance and it is not on friendly terms. Get the popcorn in.
Ellison came out, all guns blazing, to Variety:
“WBD shareholders deserve an opportunity to consider our superior all-cash offer for their shares in the entire company. Our public offer, which is on the same terms we provided to the Warner Bros. Discovery Board of Directors in private, provides superior value, and a more certain and quicker path to completion.
We believe the WBD Board of Directors is pursuing an inferior proposal which exposes shareholders to a mix of cash and stock, an uncertain future trading value of the Global Networks linear cable business and a challenging regulatory approval process.
We are taking our offer directly to shareholders to give them the opportunity to act in their own best interests and maximize the value of their shares”
Paramount also launched a website aimed directly at shareholders, at StrongerHollywood.com.
With a name like that, they are clearly hoping to leverage the artists, creatives and unions to their side who have all expressed unease at Netflix stepping so boldly into their spaces.
Game on!
