The bidding war for some of Hollywood’s most coveted brands is back on.
What happened: Warner Bros. Discovery (WBD) has reopened negotiations with prospective buyer Paramount following several hostile takeover bids, giving the Larry Ellison-owned media company a week to submit its best and final offer.
Netflix, which currently has a US$83 billion deal in place to buy Warner Bros., gave the studio permission to negotiate with Paramount until Monday.
People familiar with the negotiations expect Paramount to up its offer from $30 to $33 per share, which Netflix will then have the opportunity to match.
Catch-up: The pressure has been ramping up on Warner Bros. to engage with Paramount. Just last week, activist investor Ancora Holdings acquired a stake in WBD in a bid to pressure the board to reopen talks.
Warner Bros. leadership is reportedly still skeptical that Paramount — which boasts a market cap 20 times smaller than Netflix's — can submit a superior offer.
Why it matters: As one person close to the deal put it, this is the “put up or shut up” moment in the Warner sweepstakes. Paramount has made a big stink about its offers not being taken seriously, and now has a chance to show just how big a cheque it's willing to write.
Our take: Paramount's pitch to Warner isn’t simply that they’ll cough up more money, but that their path to regulatory approval is far smoother than the Netflix deal. The streamer disputes that, but the Ellison family’s close ties to Donald Trump certainly wouldn’t hurt Paramount's odds of getting a $100 billion-plus merger over the finish line.—LA