Netflix reportedly closes in on Warner Bros deal
Netflix is close to a deal to buy Warner Bros Discovery’s movie and streaming businesses, according to multiple reports.
The streaming giant became the highest bidder for Warner Bros, ahead of rivals Comcast and Paramount Skydance, after offering $28 (£21) per share, according to several media outlets, including Reuters and the New York Times.
Paramount made an initial offer to buy the entire company, including its cable networks such as CNN, for $24 per share in October, which Warner Bros. rejected before putting itself up for sale.
Paramount’s lawyers this week questioned the “fairness and adequacy” of the sales process, in a letter seen by CNBC.
Paramount submitted a renewed offer Thursday for a price closer to $27 per share, CNN reported.
Warner Bros. owns franchises including Harry Potter and Game of Thrones, as well as the streaming service HBO Max.
Netflix, Warner Bros and Paramount have been contacted for comment.
Emma Wall, chief investment strategist at Hargreaves Lansdown, said the takeover battle was a “drama for those who make drama”.
Speaking to the BBC’s Today programme, she said it was key to note the difference between Paramount and Netflix’s offers, pointing out that Paramount’s offer included the parts of Warner Bros’ business which were “lagging behind in terms of profitability”.
“Netflix’s offering is only for certain parts of the business, and those are the parts of the business that are doing well,” she said.
Ms Wall said Paramount had taken the unusual step of accusing Warner Bros of favoring Netflix in the process. Paramount also said the streaming platform’s offer was not as good a deal for Warner Bros. shareholders because it would require the company to be broken up.
“You kind of taint your offer if you argue,” she said.
According to CNBC, Paramount’s lawyers accused Warner Bros of undertaking “a myopic process with a predetermined outcome that favors a single bidder.”
Whichever company buys Warner Bros, Ms Wall said the US competition regulator would be likely to get involved.
“Whether Netflix succeeds in this part or Paramount comes back for more, it will create a global mega-power in TV entertainment that the regulator will want to look at,” she said.
