Warner Bros. asks investors to reject takeover bid from Paramount Skydance

Warner Bros. is telling shareholders to reject a takeover bid from Paramount Skydance, saying that a rival bid from Netflix will be better for customers.

Warner Bros. is telling shareholders to reject a takeover bid from Paramount Skydance, saying that a rival bid from Netflix will be better for customers.

“Today the Warner Bros. Discovery Board sent a clear message to you, their stockholders,” the company said in a letter to shareholders. “The WBD Board urges you to reject Paramount Skydance’s unsolicited, inferior and illusory tender offer.”

Paramount went hostile with its bid last week, asking shareholders to reject the deal with Netflix favoured by the board of Warner Bros.

Paramount is offering $30 per Warner share to Netflix’s $27.75.

A Warner Bros. merger with either company would alter the landscape in Hollywood and will face intense scrutiny from U.S. regulators as it would impact movie making, consumer streaming platforms and, in Paramount’s case, the news landscape.

Paramount’s bid isn’t off the table altogether. While Wednesday’s letter to shareholders means Paramount’s is not the offer favoured by the board at Warner Bros., shareholders can still decide to tender their shares in favour of Paramount’s offer for the entire company — including cable stalwarts CNN and Discovery.

Unlike Paramount’s bid, the offer from Netflix does not include buying the cable operations of Warner Bros. An acquisition by Netflix, if approved by regulators and shareholders, will close only after Warner completes its previously announced separation of its cable operations.

Paramount has claimed it made six different bids that Warner leadership rejected before announcing its deal with Netflix on Dec. 5. Only after that did it take its offer directly to Warner’s shareholders.