Paramount gatecrashes Netflix bid for Warner Bros giant
Paramount gate-crashed Netflix’s blockbuster takeover of Warner Bros with a rival bid of over $26bn more yesterday, writes John-Paul Ford Roja.
It means the Hollywood giant behind films including The Godfather is making an offer that it hopes shareholders cannot refuse.
And it marks the latest chapter in a high-stakes financial thriller taking in everything from The White Lotus to the White House – and in which Donald Trump’s son-in-law could play a key role.
Netflix struck the first blow last week when it agreed a $72bn takeover of Warner Bros Discovery’s film studios, behind the Harry Potter movies, and streaming services, including HBO, maker of Game Of Thrones.
But the deal was soon picked apart by critics in the film industry – and by the US President, who said there “could be a problem” because of the dominant market share the combined company would hold.
Meanwhile behind the scenes, bosses at Paramount – controlled by the Ellisons, a family with close ties to Mr Trump – were fuming.
It had already made six offers over a 12-week period for Warner Bros Discovery, only to find itself cast aside in favour of Netflix.
Yesterday it went public with its rejected offer of $108bn – going directly to shareholders and over the head of Warner’s board in what is known as a hostile bid.
Warner Bros has been a giant of the cinema industry for a century, with classic films from Citizen Kane and Casablanca to Batman and Superman.
It also owns HBO, home of The Sopranos and The White Lotus. Paramount, which dates back to 1912, can also reel off a list of some of the world’s best known films, from Breakfast At Tiffany’s to Raiders Of The Lost Ark and Mission: Impossible.
And its TV assets include CBS as well as Britain’s Channel 5.
It is also – unlike Netflix – offering to buy Warner Bros Discovery’s cable assets, including news service CNN and the Discovery Channel.
Its offer includes financing from Affinity Partners, an investment firm run by Mr Trump’s son-in-law Jared Kushner, as well as state-backed Saudi, Qatari and Abu Dhabi funds.
And it is backed by Larry Ellison, the world’s second-richest man.
The Ellison family, together with private equity firm RedBird Capital, owns Paramount.
Warner Bros Discovery’s film studios is behind the Harry Potter movies, and streaming services, including HBO, maker of Game Of Thrones. (AP Photo/Universal Studios)
Mr Ellison’s son David, the boss of Paramount, said: “We believe our offer... is in the best interests of consumers and the movie theatre industry.”
Ben Barringer, head of technology research at wealth manager Quilter Cheviot, said: “Paramount needs this deal more than Netflix, and that may be a driving factor in the valuation it is putting on Warner Bros.
“Paramount will hope that it has blown the streaming giant out of the water with this bid, but even if it has, any review is likely to result in a long process.”
