Will David Ellison offer more than Paramount Skydance’s most recent offer of $30 per share for Warner Bros. Discovery? The company did not indicate any intention to raise the price of a hostile takeover, but said it was ready to begin M&A negotiations within the seven-day negotiation period opened by WBD.
“While the actions of the[Warner Bros. Discovery]board are unusual, Paramount remains willing to engage in constructive discussions in good faith,” Ellison’s company said Tuesday.
“At the same time, we continue to advance our tender offer, continue to solicit against the unfavorable Netflix merger, and advance our intention to nominate director candidates at the upcoming WBD annual meeting,” Paramount said.
Earlier Tuesday, Warner Bros. Discovery announced that it would be in talks with Paramount to “seek clarity” about its “best and final offer.” Specifically, the Warner Bros. Discovery board cited a communication from a “senior representative of PSKY” to certain WBD board members stating that if the WBD board approves the M&A discussions, Paramount “will agree to pay $31 per share and that this offer is not PSKY’s ‘best and final’ offer.” Additionally, WBD has set a special shareholder meeting for March 20th to vote on the deal with Netflix, and the board is still encouraging investors to vote on the deal.
WBD is asking Paramount Skydance to “clarify your proposal, which we understand includes a price per share of WBD exceeding $31,” Warner Bros. Discovery CEO David Zaslav and board chairman Samuel Di Piazza Jr. said in a letter to Paramount’s board of directors.
Paramount continued to assert its position that its $30 per share offer for all of WBD was superior to Netflix’s deal to acquire WB Studios and HBO Max.
WBD’s board of directors “elected to hold a special meeting of stockholders on March 20 to seek approval for the Netflix merger and has begun mailing proxy materials stating that the merger consideration to be provided to WBD stockholders will range from a minimum of $21.23 to a maximum of $27.75,” Paramount said in a statement. “In contrast, Paramount is already offering a higher value of $30 per share, all cash, and a faster and more certain path to completion of the transaction, including the addition of the previously disclosed 25 cents per share ‘ticking fee’ that will be paid quarterly to WBD shareholders starting December 31, 2026, if the Paramount and WBD merger is not completed by then.”
While opening the door to negotiations with Paramount, WBD’s board “continues to recommend unanimously in favor of the Netflix merger,” Warner Bros. Discovery said. The board has also unanimously recommended that shareholders reject Paramount Skydance’s latest offer.
Paramount said that with the seven-day negotiation period, WBD’s board “chose to avoid making the customary determination under Netflix’s merger agreement that Paramount’s all-cash offer of $30 per share ‘could reasonably be expected to result’ in a superior offer, which would have given it an open right to negotiate without a deadline.”
