Paramount Skydance launches bid for Warner Bros. Discovery Channel

Paramount Skydance has renewed its bid to acquire Warner Bros.’ Discovery Channel, seeking to defeat rival plans by Netflix to buy the company’s studios and streaming network.

Paramount, which is backed by the billionaire Ellison family, said it would make a $30-per-share offer directly to shareholders to acquire all of Warner Bros., including its legacy television networks.

The company said its proposal was a “better option” than Netflix’s, providing shareholders with more cash upfront and a greater likelihood of regulatory approval.

President Donald Trump has said Netflix purchase ‘may be problematic’pointing out competitive issues given the size of the company.

The hostile takeover by Paramount, a smaller company than Netflix known for brands like CBS News, Nickelodeon and Mission Impossible, is the latest twist in a saga that began months ago when Paramount began submitting an offer to acquire Warner Bros.

That ultimately prompted Warner Bros., owner of HBO and classics like “Looney Tunes” and “Harry Potter,” to formally launch a bidding process.

Paramount is seen by many on Wall Street as a strong suitor for Warner Bros., in part because David and Republican megadonor Larry Ellison’s ties to Trump are expected to help streamline the approval process.

But Warner Bros. on Friday declared Netflix the winner of the auction, announcing a deal that values ​​its studio and streaming networks including HBO at about $83 billion, including its debt.

The sale will go ahead as Warner Bros. plans to spin off its other businesses, including CNN, into a separate company, the company said.

Paramount’s offer values ​​the entire company at $108.4 billion, which the company says is a better deal. Jared Kushner, Trump’s son-in-law, is one of the financial partners Paramount is working with on the deal, according to documents filed with the Securities and Exchange Commission.

any one The acquisition is expected to face scrutiny from U.S. and European competition regulators.

Analysts said Netflix’s plan could stoke concerns about streaming dominance, while Paramount’s proposal would prompt a reexamination of its impact on advertisers and local TV distributors, given the combined company’s strong presence in sports and children’s networks.

Paramount’s plan to bring CBS and CNN under the same parent company is also being closely watched because of the impact it could have on journalism and the Ellison family’s relationship with Trump.

The president said over the weekend that he expected to be involved in the approval process.

But he did not give a clear explanation of his views.

While noting potential concerns about the Netflix tie-up on Sunday, he also praised the streaming company’s boss. Meanwhile, on social media on Monday, he took aim at Paramount for a 60 Minutes interview that aired with former Trump ally Republican Representative Marjorie Taylor Greene.

Paramount CEO David Ellison told CNBC that he had a “good conversation” with Trump about the deal, but noted that he did not want to speak for the president.

Netflix is ​​the world’s largest streaming company, with more than 300 million subscribers. The company said on Friday it believed the acquisition would help strengthen its business and expressed confidence it would win regulatory approval.

But Wall Street analysts have long said they believe a merger between Paramount and Warner Bros. makes sense and would give the company the scale to compete with rivals like Netflix and Disney.

Mr. Ellison bought Paramount earlier this year and folded it into his Skydance movie studio.

“Paramount ultimately needs this deal more than Netflix does,” said Ben Barringer, director of technical research at Quilter Cheviot, who called the Warner Bros. assets “great” for the streaming company.

Ellison spoke to CNBC on Monday about the benefits of his plan for the entire media industry, arguing that Netflix’s acquisition of Warner Bros. Discovery Channel would give one company too much power over actors and other players in the industry.

“This is a terrible deal for Hollywood,” he said.

He also said he believes Warner Bros.’ plan to spin off its legacy networks into a separate company will set them up to fail and ultimately prove to be a mistake for shareholders.

“I think (its shares) are going to be worth a lot less than people are claiming,” he said.

Shares of Warner Bros. were up more than 3% in midday trading on Monday, with shares of Paramount also rising.

However, Netflix’s stock price fell.