Warner Bros. Discovery and Paramount Skydance will reopen deal talks on Tuesday after Netflix agreed to temporarily loosen restrictions in its merger agreement with WBD. The seven-day waiver allows WBD to engage Paramount in discussions over what it described as “deficiencies” in Paramount’s bid to purchase the company in full.
A bidding battle intensifies
It’s the latest development in a back-and-forth negotiation process among the three companies. In December, WBD agreed to sell its streaming and studio assets to Netflix after winning a bidding war with Paramount.
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But soon after, Paramount launched a hostile bid to acquire all of WBD. The WBD board raised concerns about the structure of that proposal and whether it was fully backed by billionaire Larry Ellison.
Paramount filed an amended bid at the end of last year, including a personal guarantee from Ellison. It offered $30 per share, while signaling it was not its “best and final” offer.
What the waiver allows
In a press release, WBD said it will use the seven-day waiver period to “seek clarity for WBD stockholders and provide PSKY the ability to make its best and final offer.”
“During this period, WBD will engage with PSKY to discuss the deficiencies that remain unresolved and clarify certain terms of PSKY’s proposed merger agreement,” the company said. “Netflix retains its matching rights as defined by the merger agreement.”
Netflix, in a separate statement, said it remains confident that its $72 billion deal offers “superior value and certainty,” but granted the waiver to allow WBS to “fully and finally resolve this matter.”
Shareholder vote ahead
WBD confirmed it will hold a special shareholder meeting on March 20 to vote on the Netflix merger. It said the board continues to recommend approval of that deal and rejection of Paramount’s proposal.
Any transaction would require federal regulatory approval, including review by the Department of Justice and potentially the Federal Trade Commission over antitrust concerns.
President Donald Trump has publicly expressed support for Paramount’s bid and said he intends to play a direct role in approving any WBD deal.
