Paramount acquisition price raised to $31, Warner: May be superior to Netflix's proposal

Gelonghui, February 25th | American entertainment giant Warner Bros. Discovery stated that Paramount Skydance has made a new acquisition offer of $31 per share, which may result in a deal superior to its existing agreement with a certain exchange. Warner Bros. issued a statement saying that the company has not withdrawn its recommendation for investors to support the exchange’s agreement to acquire its film production and HBO businesses at $27.75 per share. However, the latest terms proposed by Paramount have reached the threshold for further negotiations. Paramount’s revised proposal increases the previous offer by $1 per share from $30. The previous offer, including debt, valued the deal at about $108 billions. By the same measure, the exchange’s proposal is valued at $82.7 billions. However, Warner Bros. believes that spinning off its cable TV channel business will bring additional value to investors. Paramount’s new proposal includes several protection clauses, such as a ticking fee of $0.25 per share per quarter if the acquisition is not completed by September 30; in addition, if the deal is ultimately rejected by regulators, Paramount will pay Warner $7 billions, among other terms. Warner Bros. stated that the board has not yet decided whether the revised Paramount proposal is superior to the merger plan with the exchange. The company plans to hold further discussions with Paramount and said that if the board supports this increased offer, the exchange will have four working days to respond.