The amended proposal, worth a total of US$108 billion from the company run by Ellison’s son David, addresses concerns raised by Warner Bros’ board, which saw the Paramount bid as too risky and asked shareholders to accept a competing buyout offer from Netflix.
Netflix shocked the industry on Dec 5 by announcing it had sealed an agreement to buy the film and television studio and HBO Max streaming business for nearly US$83 billion, the entertainment industry’s biggest consolidation deal this decade.
Three days later, Paramount – whose CEO is David Ellison, son of Larry Ellison, an ally of President Donald Trump – launched an all-cash tender offer valuing the entertainment giant at US$108.4 billion.
However, Warner Bros last week described the Paramount offer as risky, saying it was backed by “an unknown and opaque revocable trust” and involved “no Ellison family commitment of any kind”.
Warner Bros Discovery also stressed the dependence of the Paramount offer on foreign investors – US$24 billion of the financing comes from Middle East sovereign wealth funds – which could require further government approval.
Paramount’s amended proposal is meant to address those concerns and also increases the breakup fee to match Netflix’s US$5.8 billion, which would be payable to Warner Bros if its offer does not clear regulatory review.
“Paramount has repeatedly demonstrated its commitment to acquiring WBD,” said David Ellison.
“Our US$30 per share, fully financed all-cash offer… continues to be the superior option to maximize value for WBD shareholders,” Ellison said.
Unlike Netflix’s offer, Paramount’s bid includes the buyout of cable channels such as CNN, TNT, TBS and Discovery – which would be added to its group of TV assets like CBS, MTV and Comedy Central.
Trump weighs in
The bidding war that will reshape Hollywood and US media has drawn White House attention.
Trump has repeatedly weighed in, saying Netflix’s deal “could be a problem” as it would leave Netflix with a huge market share of the film and TV industry.
However, he has also railed against coverage of the White House from Paramount-owned CBS News, saying neither bidder for Warner Bros had his preference.
He has stressed the importance that CNN gets new ownership as part of the Warner Bros sale, targeting the outlet he has long criticised for what he calls “fake news”.
Both Paramount and Netflix have lobbied the White House directly, with David Ellison also making conservative-friendly changes at CBS News.
Since taking over Paramount earlier this year, the company has appointed journalist Bari Weiss as editor-in-chief of CBS News.
Weiss is a prominent critic of what she calls bias in mainstream media, and the appointment won praise from conservatives.
Today, Weiss was accused by a CBS News staff member of pulling a planned segment on an El Salvador maximum-security prison where the Trump administration sent hundreds of Venezuelan migrants.