Warner Bros. gives Paramount one more week to beat Netflix merger offer

WB board officially recommends Netflix deal but asks Paramount to increase price.

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[Martin Blank]

This feels like some activist investor (or politician) is pressuring WBD into a deal with Paramount, and WBD's board is just giving every last chance for Paramount to show just how bad a deal they can come up with as evidence for the (inevitable?) trial in three years.

 

[Mario_van_Pipes]

Translation: "We'll give you a week to fall flat on your face. After that, we'll go with the company that just wants to make shows."

 

[WhyNotZoidberg]

Hah.. i guess thats a joke? The WB board is just trying to squeeze as much as they can from a deal, they could not care less if its sold to Netflix or Paramount as long as the economic terms are more beneficial. They could not care less if the buyer is going to make shows or burn everything to the ground.

If the Paramount offer is somehow superior to Netflix they'll just go back to Netflix to match it. Netflix is in a better financial situation. When Netflix does the deal will be done. Either way Netflix is going to buy it, WB is just going to squeeze every penny they can get out of them in the process.

 

[Frodo Douchebaggins]

And paramount is working hard to gargle trump's balls to have him lean his fat ass on the scale.

https://variety.com/2026/tv/news/st...talarico-interview-fcc-equal-time-1236665220/

Larry Ellison and his shitass brood are all too old for trump's pedolectorate though.

 

[ajmas]

How about: no?

Its time to stop these mega mergers which are just working towards potential anti-trust behaviours and too much power amongst too few mega players. Given history, I have a hard time to believe any "pinky promises", by any large corporation.

 

[jrhmobile]

The Ellisons have to be fools to re-approach this deal on these terms.

With Netflix having the option to match Paramount's proposal and lock the Ellisons out of the deal again, the only alternative is to make such an overwhelming deal that Netflix can't match it. So it's either spin wheels and waste a week's time or throw cubic diaperloads of money for a property beyond even Netflix's ability to pay.

Even if you're exceedingly rich, that seems world-class stupid.

 

[Spazzles]

The Ellisons have to be fools to re-approach this deal on these terms.

With Netflix having the option to match Paramount's proposal and lock the Ellisons out of the deal again, the only alternative is to make such an overwhelming deal that Netflix can't match it. So it's either spin wheels and waste a week's time or throw cubic diaperloads of money for a property beyond even Netflix's ability to pay.

Even if you're exceedingly rich, that seems world-class stupid.

That last line. Even if you're exceedingly rich, that seems world-class stupid.

That accurately describes most of the 21st century so far.

 

[forgotn1]

None of this should be allowed to go through. Mergers at this level shouldn't be legal under antitrust law, but the government seems to have decided that's not a thing anymore.

 

[MysteryMii215]

Warner Bros. has also repeatedly pointed to Netflix’s superior finances as a reason for preferring its offer. The Warner Bros. board previously called the Paramount bid “illusory” because it requires an “extraordinary amount of debt financing, and described Paramount as “a $14B market cap company with a ‘junk’ credit rating, negative free cash flows, significant fixed financial obligations, and a high degree of dependency on its linear business.”

This really does suggest to me that WBD wants to buy a bit of time for Paramount's Q4 report to drop before rejecting Paramount's "best and final" offer, because if its a disaster (which seems like its shaping up to be, given the numerous issues still facing Paramount's linear business, and the weak box office returns of their 4 theatrical releases that quarter (topped off with the massive box office bomb of The Running Man)), then they can use that report to blame Ellison with being too distracted with trying to get his hands on WBD to focus on trying to turn around the sinking ship that is the company that he only just became the head of (especially since this would be the first full quarter under his watch as the Skydance merger closed in the middle of Q3).

 

[noanoxan]

The Ellisons have to be fools to re-approach this deal on these terms.

With Netflix having the option to match Paramount's proposal and lock the Ellisons out of the deal again, the only alternative is to make such an overwhelming deal that Netflix can't match it. So it's either spin wheels and waste a week's time or throw cubic diaperloads of money for a property beyond even Netflix's ability to pay.

Even if you're exceedingly rich, that seems world-class stupid.

Musk bought Twitter. Stupid is as stupid does, but that doesn't seem to be a problem when making transactions.

Remember, it's about winning!

 

[Deleted member 221201]

I , along with (probably) a substantial number of readers on here would like to offer up Ars branded usb keys, Moon Shark t-shirts
.... in an effort to buy Warner Bro's

 

[Fenixgoon]

Hah.. i guess thats a joke? The WB board is just trying to squeeze as much as they can from a deal, they could not care less if its sold to Netflix or Paramount as long as the economic terms are more beneficial. They could not care less if the buyer is going to make shows or burn everything to the ground.

This kind of thinking ignores all societal impact outside of money, and is part of the reason things are the way they are (including X twitter becoming the cesspoole it is. Another sale that ignored any kind of social impact).

Yes, getting more money for the same sale is generally good. Unless the people you're selling it to have bad intentions for the product. Which we know they do.

So why sell the company to someone you know supports the current fascist regime, when you could...you know...not, and still profit handsomely in the process.

Edit: i would also add there is nothing in the CFR that legally requires a company to maximize profits above all else.

 

[kvndoom]

So why sell the company to someone you know supports the current fascist regime, when you could...you know...not, and still profit handsomely in the process.

Because of the 4 G's: Gordon Gecko Greed Good.

I'm surprised WBDs board is even concerned about the future of the platform vs extracting maximum dollar to wash their hands of it.

 

[Martin Blank]

This really does suggest to me that WBD wants to buy a bit of time for Paramount's Q4 report to drop before rejecting Paramount's "best and final" offer

Interesting idea, but Paramount's earnings will be released on February 25, which is eight days from today. The deadline WBD set was February 23.

 

[motytrah]

This feels like some activist investor (or politician) is pressuring WBD into a deal with Paramount, and WBD's board is just giving every last chance for Paramount to show just how bad a deal they can come up with as evidence for the (inevitable?) trial in three years.

Perhaps. But I could also see them just wanting to make Netflix pay more.

 

[heartburnkid]

The Netflix/Warner Bros. deal is facing scrutiny over how it would affect streaming consumers Donald Trump really wanting his allies, the Ellisons, to control WBD's media outlets and do to them what they did to CBS/Paramount

There, FTFY

 

[RickRoyLeonPrisZhoraRacha]

That last line. Even if you're exceedingly rich, that seems world-class stupid.

That accurately describes most of the 21st century so far.

Not all smart people are rich. But most rich people aren't smart; just lucky.

 

[Varste]

"Okay, we know your previous offer would be the largest leveraged buyout in history and bring on way too much debt. But hear me out: what if you leveraged harder?"

 

[Rick C.]

Anything that prevents any further media from coming under the control of CBS/Paramount is a good thing.

 

[dnorman]

If $31/share is illusory, how about ILLUSORY PLUS ONE?

 

[Dachannien]

The Ellisons have to be fools to re-approach this deal on these terms.

With Netflix having the option to match Paramount's proposal and lock the Ellisons out of the deal again, the only alternative is to make such an overwhelming deal that Netflix can't match it. So it's either spin wheels and waste a week's time or throw cubic diaperloads of money for a property beyond even Netflix's ability to pay.

Even if you're exceedingly rich, that seems world-class stupid.

This is about building PSKY into a media empire that is too big to fail, so that they can convert CNN into a MAGA propaganda wing without the possibility of being boycotted. They're willing to make decisions that appear bad from a business perspective to make that work. Having Star Trek under their thumb only goes so far.

 

[MysteryMii215]

Interesting idea, but Paramount's earnings will be released on February 25, which is eight days from today. The deadline WBD set was February 23.

Even then, the timing is still pretty bad for Paramount, since WBD can still reject the "best and final" offer (especially if it an offer that Netflix can easily match or beat), and any attempts by Ellison to try to go beyond that would be met with huge resistance (especially from PSKY shareholders, since some of them have not been happy about the Skydance merger in the first place) if the Q4 report is a disaster. It's essentially a scenario that I would imagine Ellison has been trying to avoid, because everything he has been trying to do really makes it seem like he's knows a bad earnings report would force him to abandon Paramount's bid and be stuck with a sinking ship that he's now actually forced to try and turn around.

 

[heartburnkid]

The Ellisons have to be fools to re-approach this deal on these terms.

With Netflix having the option to match Paramount's proposal and lock the Ellisons out of the deal again, the only alternative is to make such an overwhelming deal that Netflix can't match it. So it's either spin wheels and waste a week's time or throw cubic diaperloads of money for a property beyond even Netflix's ability to pay.

Even if you're exceedingly rich, that seems world-class stupid.

Only if the Ellisons' objective is to make money. I think that's secondary at best; their real objective here is to build a right wing propaganda juggernaut too large for any of us to avoid completely, and thus help to cement the fascist takeover of America and much of the western world.

 

[Faceless Man]

Musk bought Twitter. Stupid is as stupid does, but that doesn't seem to be a problem when making transactions.

Remember, it's about winning!

I seem to recall when it actually went ahead, it became clear he really didn't want to buy Twitter, he was just dick-swinging. The problem was he got trapped into having to find the money or face penalties for misrepresentation.

 

[Fatesrider]

Hah.. i guess thats a joke? The WB board is just trying to squeeze as much as they can from a deal, they could not care less if its sold to Netflix or Paramount as long as the economic terms are more beneficial. They could not care less if the buyer is going to make shows or burn everything to the ground.

No, I see this as a more strategic move on WB's part to kick Paramount to the curb because so far, NOTHING Paramount has offered to date comes close to what Netflix can do for WB WRT to returns.

The bottom line I've been reading is that Paramount is offering debt (which is paid over time) and long-term low yield returns that hinge on a lot of other things that could fall apart with the slightest touch.

Netflix matched Paramount's offer IN CASH. So there's a quick, clear return from the sale for WB investors. They walk away, clear of debt and no issues. Seems to me there's other IP stuff involved, but the Paramount deal doesn't favor WB with that and Netflix's does. Overall, WB loses in some respect in every offer Paramount has made for it, while they come out very clearly ahead with Netflix's deal.

Netflix would also do better to retain the IP from WB for its own offerings. Assuming the WB/Netflix deal goes through, It's already bought and paid for and can be offered IMMEDIATELY to Netflix subscribers.

Why the fuck would they burn THAT money pile when they can reap a lot of viewers for that IP alone?

 

[Pooga]

I seem to recall when it actually went ahead, it became clear he really didn't want to buy Twitter, he was just dick-swinging. The problem was he got trapped into having to find the money or face penalties for misrepresentation.

Yep. He made an offer the Twitter board couldn't ignore and put it in writing, then spent the next half a year trying to weasel his way out of it before he grudgingly accepted he'd have to follow through. Gutting it and turning it into a right-wing troll trash-fire only became his plan after he was left holding the bag.

 

[nerdrage]

They should just get on with it because either path leads to the same outcome.

Netflix buys Warners: the merger is successful because Netflix rules the world and yes they can give movies theatrical windows when it makes sense, ie, they are big franchise movies like Batman.

Netflix is not going to make a Batman movie and drop it on streaming till they've milked all the box office out of it that they can. They like making more money and not less. They ignored theaters till now because they never had franchise IP that makes money in theaters.

Paramount buys Warners: they are still much smaller than Netflix, which continues to rule the world.

Nepo has no coherent plan for turning Warners around and he will be drowning in debt. Eventually the whole thing will collapse and then Netflix can buy Paramount and Warners for a lot less than they are paying for Warners now.

 

[nerdrage]

This is about building PSKY into a media empire that is too big to fail, so that they can convert CNN into a MAGA propaganda wing without the possibility of being boycotted. They're willing to make decisions that appear bad from a business perspective to make that work. Having Star Trek under their thumb only goes so far.

NFLX doesn't want to buy CNN since they're actually rational and recognize that cable/broadcast is dead and nobody under AARP age cares about the old news outlets. It's all scattered to the wind. If nepo wants CNN, he just needs to wait till Netflix buys the other parts.

Also NFLX steers clear of news because it has to operate in 190+ countries and can you imagine trying to please all those governments and not get banned because Netflix News said something awkward?

News as we know it will die with broadcast/cable. None of the streamers seem willing to touch it. Paramount might turn CBS (and CNN if they get it) into Trump propaganda, but that's not the way to make it a viable business. That's going in the opposite direction.

 

[zeroplusone]

This feels like some activist investor (or politician) is pressuring WBD into a deal with Paramount, and WBD's board is just giving every last chance for Paramount to show just how bad a deal they can come up with as evidence for the (inevitable?) trial in three years.

The activist investor is Larry Ellison's son, and Donald Trump probably behind the scenes threatening to weaponize the DOJ Antitrust Division against Netflix.

 

[graylshaped]

Hah.. i guess thats a joke? The WB board is just trying to squeeze as much as they can from a deal, they could not care less if its sold to Netflix or Paramount as long as the economic terms are more beneficial. They could not care less if the buyer is going to make shows or burn everything to the ground.

That's putting it pretty strongly, but for the vast majority of mergers and acquisitions, the group of people who as a whole benefit the most from them are the shareholders of the company being acquired who cash out and walk away at the time of the deal.

 

[Socks Mingus]

Only if the Ellisons' objective is to make money. I think that's secondary at best; their real objective here is to build a right wing propaganda juggernaut too large for any of us to avoid completely, and thus help to cement the fascist takeover of America and much of the western world.

To be fair, the reason they want that is so that they don't have to pay taxes so that they can have more money, because the more money they have the more they can invest to get more money, and the more money they get from investing they can use to change the law and make it easier to invest, to get even more money, and then they can use that mon....

 

[fellow human]

I seem to recall when it actually went ahead, it became clear he really didn't want to buy Twitter, he was just dick-swinging. The problem was he got trapped into having to find the money or face penalties for misrepresentation.

Was this supposed to refute the point that Musk is stupid?

 

[NeoMorpheus]

As someone that was racially discriminated at paramount, this is how it will go.

If the merger happens, any minority in any position of even minor importance, will be “laid off” and replaced with a white person.

They use mergers as an excuse to purge such individuals.

Also seniors, especially if they are minority.

Fuck paramount.

 

[Faceless Man]

Was this supposed to refute the point that Musk is stupid?

Well, no, quite the opposite. He's a moronic man-child who got himself into a really stupid situation that he couldn't get out of.

Kind of puts to rest the suggestion that he's a brilliant business man.

 

[Martin Blank]

The activist investor is Larry Ellison's son, and Donald Trump probably behind the scenes threatening to weaponize the DOJ Antitrust Division against Netflix.

An activist investor is one who owns or takes a large stake in a company and then tries to use that stake to influence the direction of the company. I am not aware that anyone in Ellison's family owns much or even any WBD stock.

 

[BananaBonanza]

No, I see this as a more strategic move on WB's part to kick Paramount to the curb because so far, NOTHING Paramount has offered to date comes close to what Netflix can do for WB WRT to returns.

But, fundamentally, those returns concern only the new owner. They will be either Netflix's or Paramount's returns. The current owners will get the purchase price and nothing else.

So maximizing returns means negotiating a higher price. If Paramount increases the offer, they will just use that to re-negotiate with Netflix. Netflix has the means, just currently no reason, to pay more.

The bottom line I've been reading is that Paramount is offering debt (which is paid over time) and long-term low yield returns that hinge on a lot of other things that could fall apart with the slightest touch.

No, they're offering cash. The debt will drag down the future merged company, but when it falls apart, the current shareholders are already out.

Netflix matched Paramount's offer IN CASH.

That's a missunderstanding. Paramount was already offering cash. Netflix matched the cash-part, by changing their offer to cash without increasing it. So the deal sizes are still different, but now both are in cash.

 

[approximate_pi]

Musk bought Twitter. Stupid is as stupid does, but that doesn't seem to be a problem when making transactions.

Remember, it's about winning!

Something the modern era of billionaires being so public with their thoughts on the internet and actions available to find that should have been made very obvious to the general public but somehow hasnt is that having money doesnt in any way make you smart and there are a lot of really stupid rich people.

 

[engineerdave]

So, what happens to CNN when the Netflix offer is accepted? The Ellison's mainly want the deal to get CNN, gut it by firing newscasters Trump hates & making it Trump friendly?