Warner Bros, Paramount does not give up and launches hostile bid

It's an open battle for Warner Bros. Discovery. After months of negotiations and a long bidding war that had led the group to choose Netflix as its industrial partner, Paramount is not giving up and is going on the attack with an all-cash hostile takeover bid of $30 per share, worth more than $108 billion. The deal, also backed by collaboration with Middle Eastern sovereign wealth funds and with Jared Kushner, Donald Trump's son-in-law, is openly aiming to derail the agreement already reached between Warner Bros. Discovery and Netflix, reopening a game that seemed to be closed.

The deal, promoted by Paramount together with Skydance, concerns the acquisition of the entire Warner Bros. Discovery group, including its studio, streaming and traditional television businesses. This is the same proposal that the WBD board had rejected last week, preferring the deal with Netflix, which was considered quicker to close and less exposed to antitrust risks. Paramount has now decided to go directly to the shareholders, challenging the process that led to the choice of the Los Gatos-based group and arguing that the Netflix offer does not fully value Warner's entire industrial perimeter.

The financing of the deal is secured by a broad consortium: the Ellison family and the RedBird Capital fund provide the equity capital, while Bank of America, Citi, and Apollo Global Management provide hedging lines of around USD 54 billion. The all-cash structure is one of the central elements of Paramount's strategy, which aims to offer certainty to shareholders at a time when the media industry remains under pressure from high debt, slowing growth and margins squeezed by competition in streaming.

The initial decision by Warner Bros. Discovery's initial decision to prefer Netflix was also motivated by the fear that a merger with Paramount might encounter more significant regulatory hurdles, especially in the United States, where concentration in the media sector is under close scrutiny. Paramount's new move thus reopens an uncertain scenario, which could result in a prolonged phase of tension between management and shareholders and, potentially, in a legal confrontation.

Donald Trump also intervened on the dossier, adding a political dimension to the game. The former president stated that he is watching the operation carefully, expressing strong reservations about the hypothesis of an integration between Netflix and Warner Bros Discovery. According to Trump, the emergence of such a large streaming giant could pose competition problems and concentrate too much power in the content market. While recognising Netflix's industrial strength, Trump hinted that such a decision should be viewed with great caution by the relevant authorities.