Warner Bros. Discovery confirmed today it had a received a revised offer from Paramount “and is reviewing it in consultation with our financial and legal advisors.”
It did not disclose the terms of the new bid. The Pararmout proposal on the table for some time has been for $30 a shares in cash but the David Ellison company has bumped that up.
“We will update our shareholders following the Board’s review. The Netflix merger agreement remains in effect, and the Board continues to recommend in favor of the Netflix transaction. WBD shareholders are advised not to take any action at this time with respect to the amended PSKY tender offer,” WBD said.
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The statement was the same the company has issued several times before as Paramount continued to tweak its offer, looking to provide assurances around debt and equity financing and other concerns WBD raised. The board of the David Zaslav-led company has, so far, always come back after each review advising against a Paramount deal and recommending shareholders stick by Netflix. Stockholders will vote on the Netflix agreement at a special WBD meeting on March 20.
The backdrop of this new offer is slightly different, however, as it followed a seven-day limited waiver period for the sides to actively engage. Netflix had to agree to the discussions.
Warner Bros. Discovery agreed on Dec. 5 to sell its studios and streaming assets to Netflix in a cash and stock transaction valued at $27.75 a share, with an enterprise value of about $82.7 billion. WBD separately plans to spin off its cable business into a new company called Discovery Global, distributing stock of that company to shareholders.
Three days after the Netflix deal was announced, Paramount launched a hostile tender offer for PAr at $30 a share in cash for all of WBD, enterprise value $108 billion, and the fight was on.
On January 20, Netflix switched its bid to all cash.
The WBD board has a fiduciary duty to consider all offers.
WBD had indicated in an SEC filing that Paramount was willing to go to $31 or higher and it expected to see that in writing during the talks, which are set to run through 11:59 p.m. ET tonight if not extended. Netflix has the right to match any offer. Wall Streeters have been pretty certain Paramount would boost its number to $31 or $32 a share but believe it might need to go a bit higher than that to secure the deal.
More to come