Paramount Skydance shocked the industry on Monday by launching a hostile bid of $108.4 billion to take over Warner Bros Discovery.
The major move threatens a deal being formed between Warner Bros and Netflix, in Paramount’s latest attempt to create a new media combination capable of rivaling the streaming giant’s dominance.
Netflix emerged victorious on Friday in a weeks-long bidding war between Netflix, Paramount and Comcast after reaching a $72 billion equity deal that includes Warner Bros Discovery’s TV assets, film studios and streaming platform.
The deal, which carries a total value of $82.7 billion including debt, also includes a $5.8 billion breakup fee from Netflix. But observers expect the deal to face intense antitrust scrutiny.
Paramount has actually made several offers since September to form a powerful entertainment powerhouse, aiming to compete with Netflix and tech giants like Apple, which are increasingly moving into the media sector.
Paramount is offering a full buyout at $30 per share, higher than Netflix's offer of nearly $28 per share for Warner Bros.' assets.
As one of Hollywood's major studios, Paramount still has the power of its brand, but the company's box office performance has been inconsistent. Despite occasional big franchise successes, it has lagged behind Disney, Universal and Warner Bros. in U.S. market share.
In the latest development, Paramount has sent a formal letter to Warner Bros. questioning the sale process. It claims Warner Bros. did not conduct a fair bidding process and seemed to favor Netflix from the start.
The allegations come after reports that Warner Bros. management considered the Netflix deal a "slam dunk" and viewed Paramount's offer negatively.
