Paramount is hijacking the Netflix takeover of Warner Bros.
Paramount has topped Netflix's bid to take control of Warner Bros. by an astonishing $18 billion. What happens now?
Paramount has submitted a $108.4 billion cash offer, which is says is a “superior alternative” to the $83 billion deal agreed by the streaming service Netflix last week.
Netflix has already announced the deal and is preparing to welcome Warner into the fold, but this last minute offer throws a spanner into the works. While the statement from Paramount goes into a lot of market-speak, this could be a bit development that affects the way we consume entertainment for generations to come.
Movie theatre trade organisations are appalled by the idea Netflix could get control over Warner properties. As a legacy movie studio with the box office as a critical part of its revenue, Paramount would probably be more in favour of keeping flicks in the cinema for longer.
Hoping to woo Warner Bros. Discovery shareholders, Paramount cites a higher per-share offer, is planning to pick up Warner’s linear networks too (which Netflix didn’t), and promises them a smoother path trough the tough regulatory waters.
Paramount also criticises the Netflix deal as being “based on an illusory prospective valuation of Global Networks that is unsupported by the business fundamentals and encumbered by high levels of financial leverage assigned to the entity.”
“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.”
Whether the rival bit throws a spanner into the works of the agreement remains to be seen.
Chris Smith
