Paramount Skydance today reaffirmed its $30 a share all cash offer for Warner Bros. Discovery.
The company led by David Ellison said it “notes” WBD’s “decision not to engage on Paramount’s “fully financed all-cash offer to acquire all of WBD” and laid out its arguments in a press release, calling the offer superior to WBD’s current deal with Netflix and insisting that its financing is sound and that it has been receptive to all of WBD’s concerns.
“Throughout this process, Paramount has diligently and constructively addressed each concern raised by WBD. As detailed in Paramount’s December 22 amended proposal and subsequent filings, Paramount cured every issue raised by WBD on December 17, most notably by providing an irrevocable personal guarantee by Larry Ellison for the equity portion of the financing. Nevertheless, WBD continues to raise issues in Paramount’s offer that we have already addressed, including flexibility in interim operations.”
“Paramount’s offer is superior to WBD’s existing agreement with Netflix and represents the best path forward for WBD shareholders. $30.00 per share in cash is easy to value. Netflix’s transaction, on the other hand, contains multiple uncertain components and has already decreased in total value. When announced in December, the Netflix transaction offered WBD shareholders $23.25 in cash, $4.50 in Netflix stock and a share in the pending spin-off of Discovery Global. Today, Netflix’s stock price is trading well beneath the low end of its collar, reducing the value offered to WBD shareholders.
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In addition, while the WBD Board has not disclosed any analysis to help its shareholders value their potential ongoing ownership of the linear stub, Versant Media, its closest comparable, debuted shares this week and its performance to date illustrates the challenged path ahead for Discovery Global. Paramount’s analysis (detailed below) shows the total value of the Netflix transaction to WBD shareholders today is $27.42 – unmistakably inferior to Paramount’s $30.00 in cash.
David Ellison, Chairman & CEO of Paramount said: “Our offer clearly provides WBD investors greater value and a more certain, expedited path to completion. Throughout this process, we have worked hard for WBD shareholders and remain committed to engaging with them on the merits of our superior bid and advancing our ongoing regulatory review process.”
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