Paramount Skydance has raised its offer to buy Warner Bros Discovery and is trying to force Netflix out of the takeover race. The upgraded bid could shape the future of one of Hollywood’s biggest media groups.
Warner Bros said Paramount agreed to increase its offer by one dollar per share. The board said the proposal could reasonably lead to a superior deal.
Warner Bros will now enter further negotiations before deciding whether to abandon the agreement it signed with Netflix in December. Netflix has four days to submit a counter-offer and did not comment immediately.
Netflix Keeps Its Options Open and Rejects Bidding War Talk
In a recent interview, Netflix co-chief executive Ted Sarandos avoided saying whether the company would enter a bidding war. He described the back-and-forth as a normal part of the process.
He said Netflix liked the current deal and remained a disciplined buyer. He later described the negotiations as a process of price discovery.
Paramount Drives Acquisition Strategy With Ellison Family Backing
Paramount is backed by tech billionaire Larry Ellison and led by his son David. The company has pushed a high-profile campaign to acquire Warner Bros since last year. It wants to become a dominant Hollywood powerhouse.
Warner Bros rejected Paramount’s earlier offers. In December, it agreed to sell its film and streaming divisions, including HBO, to Netflix. The deal valued the assets at 27.75 dollars per share and about 82 billion dollars including debt.
Warner Bros planned to spin off the rest of its operations. This included traditional television networks and its news channel, which would become an independent company.
New Cash Offer Raises Price and Adds Heavy Break Fees
After rejection, Paramount improved its original proposal of 30 dollars per share for the entire company. This marks the first time it officially agreed to pay more.
Warner Bros said Paramount now offers 31 dollars per share in cash. The offer includes additional payments if completion is delayed.
Paramount also agreed to pay seven billion dollars if the deal collapses. It will cover the 2.8 billion dollar break-up fee Warner Bros would owe Netflix.
Warner Bros said its board has not made a final decision.
Political Scrutiny Intensifies Over Market Power
Lawmakers raised concerns about both takeover proposals. They cited monopoly risks and potential effects on the entertainment industry.
In a Washington hearing earlier this month, Sarandos faced questions about possible price increases and the future of cinemas.
Democrats also focused on the Ellison family’s ties to the Trump administration.
Analysts Expect Bidding War and Higher Final Price
Warner Bros said it will continue discussions to determine whether a superior proposal can be reached.
Media adviser Luke Stillman said Warner Bros likely wants to trigger a bidding war. He said the final price could rise to as much as 33 dollars per share.
