By Dawn Chmielewski
Feb 24 (Reuters) – Warner Bros Discovery opened the door on Tuesday to Paramount Skydance after its CEO, David Ellison, raised the offer to $31 per share.
The Warner board determined that Paramount’s revised bid, which includes improved terms and strengthened financing, could result in an offer that is superior to its deal with Netflix. The Warner board has not reached that determination yet and will continue its talks with Paramount.
Paramount enticed Warner’s board back to the bargaining table last week by raising the possibility of an improved cash offer for Warner shareholders. In its revised bid, Paramount raised the termination fee it would pay should the deal fail to gain regulatory approval, to $7 billion — up from $5.8 billion. It also agreed to pay Warner shareholders 25 cents per share per quarter, for every quarter beyond September 30 that the deal does not close.
The rival bidder also agreed to contribute more equity, should banks raise concerns about Paramount’s ability to finance the deal at the time it closes.
Warner’s board said it has not determined whether the revised Paramount proposal is superior to the merger with Netflix, but that directors will engage further. Should a superior deal emerge, Netflix has four days to revise its existing $27.75 all-cash bid, which values Warner Bros at $82.7 billion.
Netflix declined comment. Paramount could not be reached for comment.
(Reporting by Dawn Chmielewski in Los Angeles; Svea Herbst-Bayliss in Boston, Aditya Soni and Harshita Mary Varghese in Bengaluru; Editing by Arun Koyyur, Nick Zieminski and Lisa Shumaker)
Comments