Warner Bros Board Says No To Paramount, Sticks With Netflix

Warner Bros just made a huge call. The board voted unanimously to turn down that enormous $108.4 billion bid from Paramount Skydance. They’re walking away from the money to go with Netflix instead, saying it’s the better deal for the company in the long run. It looked like a done deal a few weeks ago when Warner Bros Discovery agreed to sell the whole shop to Netflix for nearly $83 billion. Then, Paramount decided to make things interesting. They swooped in last week trying to outbid Netflix, offering shareholders $30 per share to beat Netflix's $27.75 price tag.

In a letter to shareholders on December 17, Warner Bros.' board said Paramount “consistently misled” them into believing the $30-per-share cash offer was fully backed. The board made it clear they see the Paramount proposal as risky and unconvincing. They also pushed back firmly against claims that the Ellison family is bankrolling the deal. It is to be noted that Paramount is backed by the billionaire Ellison family, which has close ties to Donald Trump. Netflix gave the decision a thumbs up, insisting their offer is the smartest play for shareholders. They reminded everyone that, unlike the competition, their funding is simple and solid, and they don't expect the government to step in and block the sale.

The latest decision really messes up Paramount's plans. They have spent the last few months trying everything to land this deal so they can compete with Amazon and Netflix. They made half a dozen offers in just a few weeks. Now they have a tough choice to make: raise the price or give up. Paramount may come back with more money to fix this, but they aren't doing it. They’re sticking to the $30 offer, insisting it’s already the best deal. It looks like their plan is to just convince the shareholders to take the current price rather than offering anything new.

If the Netflix-Warner Bros deal goes through, the industry will never look the same. Netflix takes over everything—HBO Max, the movie studios, and all the TV shows. Since they're already leading the streaming wars, adding franchises like Harry Potter and Batman to their library is massive. It instantly makes them a major player in gaming and consumer products, not just TV. But Netflix doesn't want the cable TV channels. If this deal goes forward, Warner Bros. has to figure out how to offload networks like CNN and TNT, basically spinning them off into their own separate company, before Netflix officially takes over.