How Netflix may be planning to revise its Warner Bros Discovery offer to finalise deal

Netflix is reportedly preparing an all-cash offer to acquire Warner Bros Discovery’s (WBD) film studios and streaming operations. According to a report by the news agency Reuters, these changes are aimed at accelerating a sale that has faced opposition from competing bidders and politicians. The move comes after Warner Bros. Discovery shrugged off a number of bids from Paramount.The Reuters report cited sources to claim that Netflix’s all-cash deal aims to finalise an agreement that may still take months to close.

While Netflix's deal came to $82.7 billion and bundled both Warner Bros' film arm and its streaming unit with a mix of cash and stock, Paramount's was $108.4 billion purely in cash for the whole company, even covering its cable TV operations.Still, Warner Bros has preferred Netflix's deal despite amendments to Paramount's bid, including a $40 billion equity backing by Oracle co-founder Larry Ellison, who is also the father of Paramount CEO David Ellison.




Warner Bros' board has argued that Paramount's offer depends on significant debt financing, which increases the risk of completing the deal, and that the offer “remains inadequate.”

Paramount and Netflix have been in an intense competition to acquire Warner Bros, its valuable movie and television studios, and its massive content library.

Warner Bros’ popular entertainment properties include “Harry Potter,” “Game of Thrones,” “Friends”, and the DC Comics universe, as well as highly valued classic films such as “Casablanca” and “Citizen Kane.”

The bidding war has become Hollywood's most closely watched takeover battle, as studios navigate an industry increasingly controlled by streaming services and unpredictable box-office earnings, the Reuters report added.

Meanwhile, US lawmakers from both parties have also expressed concern that further media consolidation could raise prices and give consumers fewer choices.

Paramount files lawsuit against Warner Bros as company ‘favours’ Netflix offer

Earlier this week, Paramount sued Warner Bros for more information on its deal with Netflix and said it planned to nominate directors to Warner Bros' board.

Paramount has argued that the company's all-cash bid of $30 per share for all of Warner Bros is better than Netflix's cash-and-stock offer of $27.75 per share for the studios and streaming assets and will more easily pass regulatory approval.

Meanwhile, Netflix has agreed to a $5.8 billion termination fee if it cannot get regulatory approval. On the other hand, Warner Bros would be required to pay the streaming giant a $2.8 billion termination fee for abandoning its agreement with Netflix.