Paramount offers $108 billion for Warner, outbidding Netflix by $25 billion. David Ellison criticizes the Netflix deal as problematic under antitrust law.
On Friday, December 5th, it looked like Paramount would lose to Netflix. The two companies fought for weeks over the takeover of Warner Bros. Discovery. In the end, Netflix beat out Paramount and agreed to an $83 billion deal with Warner. Now a spectacular twist is on the horizon: Paramount surprisingly outbids Netflix.
$108 billion offering
As the “SZ” now reports, Paramount apparently wants to prevent the takeover by the streaming provider at all costs. The US media group is now making a hostile, better offer to Warner shareholders. Paramount would pay $30 per share, outbidding Netflix by almost $2. The entire deal would be worth a total of $108 billion.
Paramount boss David Ellison has already spoken out and justified the move by saying that Warner was withholding a better offer from its shareholders. “Shareholders deserve the chance to consider our significantly better all-cash offer for their shares of the entire company,” it said in a statement. Netflix therefore only wants to take over parts of Warner – the TV station CNN, for example, should be spun off beforehand.
Antitrust concerns in the Netflix deal
Ellison further argued that a takeover by Netflix would raise antitrust issues. Donald Trump also chimed in and referred to the competition review. Netflix’s high market share is a problem for the takeover. Netflix is the global market leader with 300 million subscribers, while HBO Max, which belongs to Warner, has 130 million users. The balance of power on the market would therefore shift significantly towards Netflix.
Political component
A political component also plays a major role in the takeover battle. Donald Trump has already announced that he will interfere in the process. He might well prefer a takeover by Paramount. Paramount is led by David Ellison, the son of Oracle founder Larry Ellison, one of the world’s richest entrepreneurs and a Trump supporter. After the Ellison family took over, there were already changes in the CBS newsroom. A late-night show that criticized Trump was also canceled.
Cinema operators also protested against the takeover by Netflix. They fear that classic cinema could die out as a result of the takeover.