Paramount Skydance made a bold move on Monday, launching a hostile takeover offer for Warner Bros. Discovery after accepting a deal with Netflix. This comes amid President Trump’s warning that the Netflix arrangement “could be problematic” in terms of antitrust regulations.
Paramount is reaching out directly to shareholders, proposing to buy the entire company for $30 per share in cash—this mirrors the offer that Warner Bros. Discovery turned down just last week, according to earlier reports.
The financing for the offer is backed by solid commitments from Bank of America, Citi, and Apollo, along with investments from the Ellison family and Redbird Capital.
In a press release on Monday, Paramount asserted that their deal “provides greater value to WBD shareholders and a quicker, more secure completion process.”
“We’re really here to finish what we started,” said CEO David Ellison during an appearance on CNBC’s “Squawk on the Street.”
On Friday, Netflix announced plans to acquire Warner Bros. Discovery’s studio and streaming assets for a staggering $72 billion, which totals up to $82.7 billion when including debt.
This acquisition could pave the way for a major Hollywood powerhouse, uniting iconic properties like Stranger Things, Squid Games, Harry Potter, and Batman, while merging Netflix and HBO Max’s combined streaming subscriber base of over 400 million.
President Trump added on Sunday that the deal “could be problematic” and mentioned he would play a role in overseeing the merger approval process.
“We’ll have to go through the process and see what transpires,” Trump told reporters on the red carpet at the Kennedy Center Awards. He noted that Netflix has a significant market share and that acquiring Warner Bros. would amplify that considerably.
Trump also stated he would consult with “some economists” before making any decisions regarding the merger, indicating his intent to be involved in an antitrust review. He confirmed a recent meeting with Netflix CEO Ted Sarandos at the White House before the deal was struck, remarking that he has substantial respect for him but that Netflix’s market share is quite large.
Reportedly, Sarandos left the meeting believing that there wouldn’t be immediate resistance from the White House regarding the merger.
Even though the Netflix deal doesn’t require FCC approval since it doesn’t involve broadcasters, it might still attract scrutiny from the U.S. Department of Justice and other international regulators.
While Netflix’s agreement covers Warner Bros.’ film and TV studios, as well as HBO and HBO Max, Paramount is vying for the entire company, which includes news networks like CNN and Discovery.
The Wall Street Journal noted that Paramount sent two letters last week to WBD’s executives, expressing concerns about the “fairness and appropriateness” of the auction and insisting that the Netflix deal “will never go through.”
In a subsequent response, WBD clarified that the company is in “strong compliance” with its fiduciary responsibilities.
It has been reported that White House officials have already convened to discuss potential antitrust issues related to a merger between WBD and Netflix.
On another front, Senator Elizabeth Warren (D-Mass.) described the deal as an “anti-monopoly nightmare,” and a group of unnamed filmmakers expressed similar concerns, urging Congress to investigate the acquisition.
Interestingly, the agreement includes a commitment from Netflix to continue releasing theatrical films for WBD, signaling a substantial shift for the streaming service.
While Netflix and HBO Max will continue to operate as separate entities, there’s been no word yet on whether a bundle of the two services will be offered or if subscriber pricing will change.
Netflix stated that the partnership aims to provide “more choice and greater value” to its customers.
If the deal goes through, it would follow the $8.4 billion merger of Skydance Media and Paramount Global from July, which had its own set of antitrust and political hurdles.
The FCC eventually approved that deal after Skydance agreed to certain commitments, including measures related to diversity and appointing a media bias ombudsman for CBS News. Moreover, Paramount agreed to pay $16 million to Trump’s future presidential library to resolve a lawsuit related to a “60 Minutes” interview that was claimed to have been deceptively edited.
