NEW YORK – In a strategic move, Warner Bros. has urged its shareholders to dismiss the acquisition proposal from Paramount Skydance, advocating instead for a partnership with Netflix, which it believes will better serve its customers.
“We are convinced that a collaboration between Netflix and Warner Bros. will provide consumers with greater options and value,” Warner Bros. declared on Wednesday. “This alliance will enable the creative industry to connect with larger audiences through our combined distribution networks and will drive our sustainable growth. The decision to partner with Netflix was strategic, as their extensive collection of iconic franchises, vast library, and robust studio capabilities enhance rather than overlap with our current offerings.”
Last week, Paramount went on the offensive with its offer, urging shareholders to reject Warner Bros.’ board-approved deal with Netflix.
Paramount has proposed $30 per Warner share, outbidding Netflix’s offer of $27.75.
While Paramount’s proposal is currently not endorsed by Warner Bros.’ board, shareholders still retain the option to accept Paramount’s offer, which encompasses the entire company, including notable cable entities such as CNN and Discovery.
In contrast, Netflix’s proposal does not involve acquiring Warner Bros.’ cable operations. Should the Netflix deal receive approval from both regulators and shareholders, the acquisition will only proceed following Warner’s completion of its planned separation from its cable operations.
Paramount has claimed it made six different bids that Warner leadership rejected before announcing its deal with Netflix on Dec. 5. Only after that did it take its offer directly to Warner’s shareholders.
Beyond a greenlight from shareholders, both takeover bids face tremendous regulatory scrutiny. A change in ownership at Warner would drastically reshape the entertainment and media industry — impacting movie making, consumer streaming platforms and, in Paramount’s case, the news landscape.
Critics of Netflix’s deal say that combining the massive streaming company with Warner’s HBO Max would give it overwhelming market dominance, whereas the Paramount+ streaming service is far smaller.
“This is something that we’ve heard for a long time—including when we started the streaming business,” Warner Bros. said in a securities filing Wednesday. “Our stance then and now is the same—we see this as a win for the entertainment industry, not the end of it.”
Bids from both Netflix and Paramount have raised alarm for what they could mean for film and TV production. While Netflix has agreed to uphold Paramount’s contractual obligations for theatrical releases, critics have pointed to its past business model and reliance on online releases. Yet Paramount and Warner Bros. are two of the “big five” legacy studios left in Hollywood today.
Paramount’s attempt to buy Warner’s cable networks and news business would also bring CBS and CNN under the same roof. In addition to further accelerating media consolidation, that could raise questions about shifts in editorial control — as seen at CBS News both leading up to and following Skydance’s $8 billion purchase of Paramount, which it completed in August.
U.S. President Donald Trump has already been vocal about his future involvement in the deal, indicating that politics will play a role in regulatory approval.
Trump previously said that Netflix’s deal “could be a problem” because of the potential for an outsized control of the market. The Republican president also has a close relationship with Oracle’s billionaire founder Larry Ellison — the father of Paramount’s CEO, whose family trust is also heavily backing the company’s bid to buy Warner.
Affinity Partners, an investment firm run by Trump’s son-in-law Jared Kushner, previously said it would investing in the Paramount deal, too. But on Tuesday, the firm announced that it would be dropping out of the bid.
Still, Trump also has a tendency to make decisions based on gut and his personal mood. He has continued to publicly lash out at Paramount over editorial decisions at CBS’ “60 Minutes.”
“For those people that think I am close with the new owners of CBS, please understand that 60 Minutes has treated me far worse since the so-called “takeover,” than they have ever treated me before,” Trump wrote on his platform Truth Social on Tuesday. “If they are friends, I’d hate to see my enemies!”
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