Warner Bros rejects Paramount’s revised bid, calls it a risky leveraged buyout

Warner Bros. Discovery (WBD) has turned down Paramount Skydance’s revised hostile bid, stating the offer relies on an extraordinary amount of debt financing, would become the largest leveraged buyout in history, and lacks certainty compared to WBD’s signed agreement with Netflix. The board maintained the Netflix deal as the superior path on value and execution.

Paramount kept the offer price at $30 per share and raised the termination fee to match Netflix, while Oracle co-founder Larry Ellison personally backstopped a substantial portion of equity financing through the Ellison family trust. Even so, WBD argued the proposal still presents significant costs, risks, and uncertainties for shareholders.

The contest underscores the strategic stakes around WBD’s iconic content portfolios, including major film and TV franchises, as bidders vie for scale in a rapidly consolidating media landscape.

Key highlights

• Offer rejected: WBD board unanimously declines Paramount’s amended $108.4B bid as risky LBO.
• Price unchanged: $30/share, all cash; termination fee raised to $5.8B.
• Financing backstop: Larry Ellison provides personal guarantee on equity financing.
• Preferred path: WBD reaffirms signed Netflix merger agreement as superior.
• Strategic context: Competing bids target WBD’s premium studios and libraries.

Sources: Moneycontrol; Axios; The Wrap; Yahoo Finance; Asharq Al-Awsat