Netflix co-CEO Ted Sarandos is responding to criticism of the Warner Bros. streaming service’s acquisition. Discovery of ‘The Claman Countdown.’
Netflix dropped its bid to buy Warner Bros. after the studio announced Paramount’s latest bid to buy the entire company was “better.”
“The transaction we negotiated would have created shareholder value in a clear form of regulatory approval. However, we have been disciplined, and at the price required to match Paramount Skydance’s recent offer, the deal is no longer financially attractive, so we decline to match Paramount Skydance’s bid,” Netflix co-CEOs Ted Sarandos said in a statement to Greg Peter.
They continued, “Warner Bros. is a world-class organization, and we want to thank David Zaslav, Gunnar Wiedenfels, Bruce Campbell, Brad Singer and the WBD Board for conducting a fair and rigorous process. We believe we will be strong stewards of Warner Bros.’ brand, and that our deal would strengthen the entertainment industry and preserve and create additional manufacturing jobs in the US. But this transaction was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.”
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Warner Bros. Discovery announced on Thursday that Paramount’s bid to take over the company was “higher” than Netflix’s deal. (Photos by Mario Tama/Getty/Getty Images)
Earlier in the day, Warner Bros. Discovery said Paramount’s latest offer was “better.”
“Warner Bros. Discovery, Inc. today announced that its Board of Directors, after consultation with its independent financial and legal advisors, has determined that the previously disclosed proposal from Paramount Skydance Corporation constitutes a ‘Senior Corporate Proposal’ as defined in WBD’s merger agreement with Netflix, Inc.” said the company in a press release.
Paramount’s revised offer raises WBD’s value to $31.00 per share, valuing the company at $111 billion. Paramount will also pay a $2.8 billion termination fee to Netflix if WBD pulls out of their deal.
“We are pleased that the WBD Board has unanimously confirmed the maximum value of our offer, which brings to WBD shareholders maximum value, certainty and speed of closing,” Paramount CEO David Ellison said in a statement.
Ellison’s billionaire father, Larry Ellison, is personally backing Paramount’s bid to raise $45.7 billion through Ellison Trust and Bank of America Merrill Lynch, Citi and Apollo to provide $57.5 billion in debt.
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Netflix declined to raise its offer to Warner Bros., paving the way for Paamount to take over. (Nikos Pekiaridis/NurPhoto via Getty Images/Getty Images)
In December, Warner Bros. announced that it had reached an agreement with Netflix to buy the Hollywood studio and HBO for $83 billion, prompting Paramount to launch an aggressive $108 billion takeover bid for the entire company, including all of its cable assets such as CNN, which could be spun off into a separate company under the Netflix deal.
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Paramount CEO David Ellison to take Warner Bros. Discovery will follow his $8 billion acquisition of Paramount last year. (Charly Triballeau/AFP via Getty Images/Getty Images)
Both Paramount and Netflix’s bids for Warner Bros. have caused panic throughout the entertainment industry.
Critics of Paramount’s bid fear that putting the two legacy studios under one company will lead to mass layoffs and worry that Ellison will take over CNN, while critics of Netflix worry about the giant’s growing influence and whether it will commit to theatrical windows to release films in support of cinemas.
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