Paramount does not give in on Warner: new deadline 20 February for bid against Netflix
Hostile takeover offer extended for the second time. So far around 7 per cent of the capital has adhered. Meanwhile, Paramount Skydance is aiming to convince shareholders to reject the deal with Netflix by proxy fight
Paramount Skydance does not intend to give up on Warner Bros Discovery. Thus, it once again moves the bar forward: its hostile tender offer on the David Zaslav-led media big has been extended and will now expire on 20 February.
The point is that, so far, the operation does not have the air of a victorious assault. Paramount has, for its part, announced that, as of 21 January at 11pm New York time, some 168.5 million shares had been tendered, i.e. roughly 7% of the total outstanding. Of course, in 'real' tenders one often waits until the last minute, also for tactical reasons.
On the other hand, Warner does nothing to mask his irritation. And he responds with a sentence that is both an attack on the David Ellison-led company and a message to investors: 'Once again, Paramount continues to make the same offer that our board has repeatedly and unanimously rejected, in favour of a superior merger deal with Netflix. It is also clear that our shareholders agree, with over 93 per cent also rejecting Paramount's inferior scheme."
Because the heart of the dispute has now become a referendum: Paramount versus Netflix, with Warner Bros Discovery in the middle and the shareholders as the needle of the scales. Warner plans an extraordinary meeting to approve the deal with Netflix by April: a milestone that, for Paramount, is also a countdown. Hence the decision to raise the stakes on the most 'political' terrain of finance: the proxy fight. Paramount has already put on paper its intention to ask investors to vote against the deal with Netflix.
On the table are two offers that tell of two different ideas of Warner Bros Discovery. On the one hand, Netflix, which has revised its offer making it all-cash, aims to buy studios and streaming (including Hbo Max), i.e. the most desirable and most 'digital' piece of the group. Paramount, on the other hand, is aiming at the whole company: a larger, more unwieldy deal and - inevitably - one that might be more exposed to antitrust doubts, although the Ellison family's proximity to White House tenant Donald Trump is a game-changer.
