Paramount Responds to WBD Talks: Will Play It Straight Yet Push Forward with a Hostile Offer and Proxy Campaign
Paramount has issued a response to Warner Bros. Discovery’s move, which—backed by Netflix—plans seven days of discussion through February 23 with the David Ellison company about a potential deal.
Paramount notes WBD’s announcement that, together with Netflix, they have chosen to grant Paramount a seven-day negotiation waiver. In doing so, WBD’s board has bypassed the standard determination under the Netflix merger agreement that Paramount’s superior all-cash offer of $30 per share “could reasonably be expected to result in” a superior proposal, a step that would have granted WBD unfettered time to negotiate without a deadline.
Despite this, WBD remains unconvinced that talks with Paramount can yield a proposal better than the Netflix deal. The company continues to advocate for its own merger with Netflix and has scheduled a March 20 special shareholder meeting to vote on that deal.
Paramount’s response, while measured, underscores Warner Bros. Discovery’s materials noting that Netflix’s value to WBD shareholders “will be a minimum of $21.23 to a maximum of $27.75” per share in cash. WBD has characterized the lower end as a hypothetical figure that is unlikely to occur.
By contrast, Paramount argues it already offers a higher value of $30 per share in cash, with a faster and more certain path to closing a transaction, including the previously disclosed addition of a $0.25-per-share, per-quarter ticking fee. Paramount did not address the possibility of raising its base offer beyond $30, although such a move had been floated publicly.
Paramount emphasizes that while WBD’s board actions are unusual, it remains prepared to engage in good-faith, constructive discussions. At the same time, Paramount will press forward with its tender offer, continue to oppose the Netflix-merger-backed proposal, and proceed with nominating a slate of directors for the upcoming WBD annual meeting.
