Warner Bros. Discovery will reopen discussions with Paramount Skydance regarding a potential acquisition, following a waiver granted by Netflix, the streaming giant currently pursuing a separate deal for Warner’s studio and streaming assets. The move, announced Tuesday, allows Paramount a week to submit a “best and final” offer, according to Warner Bros. Discovery.
The decision to revisit talks with Paramount comes as Warner Bros. Discovery continues to recommend shareholders approve its existing agreement with Netflix, a deal valued at over $80 billion. A special shareholder meeting to vote on the Netflix transaction is scheduled for March 20. The Netflix deal would see Warner Bros. Discovery spin off its television networks into a separate company, while Netflix acquires the studio and streaming businesses.
Netflix granted Warner Bros. Discovery the seven-day waiver to engage with Paramount Skydance, a move the streaming service characterized as a response to what it called “antics” by Paramount. “Netflix is confident that its proposed transaction provides superior value and certainty,” the company stated, adding that the waiver was intended to “finally resolve this matter.”
Paramount, led by CEO David Ellison, launched a hostile bid for all of Warner Bros. Discovery, including CNN, offering $30 per share. This countered the Netflix offer, which values the studio and streaming assets at $27.75 per share. Warner Bros. Discovery has consistently questioned the financing behind Paramount’s bid, characterizing it as overly risky and akin to a leveraged buyout.
Warner Bros. Discovery CEO David Zaslav affirmed the company’s commitment to maximizing shareholder value. “Throughout the entire process, our sole focus has been on maximizing value and certainty for WBD shareholders,” Zaslav said in a statement. “We are engaging with [Paramount Skydance] now to determine whether they can deliver an actionable, binding proposal that provides superior value and certainty for WBD shareholders through their best and final offer.”
The current situation represents a complex negotiation, with Warner Bros. Discovery attempting to leverage interest from both Netflix and Paramount to secure the most favorable terms for its shareholders. The company’s board unanimously supports the Netflix deal but is willing to consider a potentially higher offer from Paramount. The deadline for Paramount to submit its final proposal is February 23.
Paramount Skydance did not immediately respond to requests for comment.
