Paramount Skydance has escalated its takeover battle for Warner Bros Discovery by filing a lawsuit seeking greater transparency around Warner Bros’ agreement with Netflix. The lawsuit aims to compel Warner Bros to disclose the financial analysis that led its board to support Netflix’s $82.7 billion cash-and-stock deal.
The David Ellison-led company has also taken a more aggressive stance by planning to nominate its own slate of directors to Warner Bros’ board. This move is intended to persuade shareholders that Paramount’s $108.7 billion all-cash offer is superior to Netflix’s proposal, according to reports.
Paramount defends bid. Read report here
Paramount and Netflix are currently locked in a fierce contest to acquire Warner Bros’ prized film and television studios and its vast content library, which includes major franchises such as Harry Potter and DC Comics.
Last week, Warner Bros rejected Paramount’s latest bid and advised shareholders to vote in favour of the Netflix transaction. The company also highlighted that walking away from the Netflix deal would trigger a $2.8 billion termination fee, contributing to total exit costs of $4.7 billion.
In a letter to shareholders, Paramount argued that its offer of $30 per share for the entire Warner Bros business is more attractive than Netflix’s $27.75 per share bid, which only covers the studios and streaming assets. Paramount also said its all-cash deal would face fewer regulatory hurdles.
Additionally, Paramount announced it would seek an amendment to Warner Bros’ bylaws that would require shareholder approval for any separation of the company’s cable television business — a key element of Netflix’s proposed transaction.
Responding to the lawsuit, Warner Bros dismissed it as “meritless,” stating that Paramount has neither increased its offer nor addressed what it described as the “numerous and obvious deficiencies” in Paramount’s proposal.