The biggest media battle of the decade continues to heat up.
According to CNBC, Warner Bros Discovery (WBD) is poised to reject the amended $108.4 billion hostile offer from Paramount Skydance, despite billionaire Larry Ellison stepping in with a personal guarantee to back the financing.
🥊 TALE OF THE TAPE: The Two Suitors
1️⃣ The Hostile Bid: Paramount Skydance
- Offer: $108.4 Billion ($30/share All-Cash).
- The Sweetener: Larry Ellison’s personal guarantee + higher regulatory reverse termination fee.
- The Argument: Creates a studio larger than Disney; offer is “market-proof” (cash) vs. fluctuating stock.
- The Hurdle: WBD Board cites financing uncertainty and massive regulatory antitrust concerns.
2️⃣ The Favored Bid: Netflix
- Offer: $82.7 Billion (Cash-and-Stock).
- The Lock-in: Includes a $2.8 Billion breakup fee if WBD walks away.
- The Argument: Lower headline value, but significantly higher “Deal Certainty” and clearer financing structure.
🏛️ THE REGULATORY WILDCARD: The backdrop is messy. Lawmakers are already flagging consolidation risks, and President Donald Trump has stated plans to weigh in on the deal, adding political risk to the antitrust equation.
💡 ANALYST TAKEAWAY: WBD’s preference for the lower Netflix bid ($82.7B) over Paramount’s higher offer ($108B) proves the golden rule of mega-mergers: Certainty often trades at a premium over Valuation. The Board is effectively signaling that Paramount’s execution risk is too high a price to pay.
👇 M&A Bankers: Would you advise a client to take a 30% lower bid for higher execution certainty in this regulatory climate?