WBD Rejects Paramount Bid, Favors Netflix Deal Amid Sports Rights Concerns

• WBD board believes Netflix proposal is “more certain and superior choice”
• SEC filing from WBD states that Paramount is paying “above-market” rates for some of its media rights deals
• paramount could still make another offer

Warner Bros Discovery (WBD) has urged its shareholders too reject Paramount Skydance’s US$108.4 billion takeover bid, describing it as “inferior” to the rival offer from Netflix.

The media giant accepted a US$82.7 billion offer from Netflix to acquire WBD’s studio and streaming assets earlier this month. However, days later, Paramount tabled a hostile all-cash bid for the entirety of WBD,arguing its offer was “superior” to Netflix’s proposal.

Paramount’s bid is backed by funding from the Ellison family,private equity firm RedBird Capital Partners,and several Middle Eastern sovereign wealth funds – which CNBC reports include saudi Arabia’s Public investment Fund (PIF),abu Dhabi’s L’imad Holding Company PJSC,and the Qatar investment Authority (QIA).

Though, WBD’s board has “unanimously” recommended shareholders reject Paramount’s offer, stating that a deal with Netflix remains in the company’s best interests.

In a lengthy legal filing, WBD’s board said the offer from Paramount poses numerous and significant risks, and strongly rejects the idea that the Ellison family – which has close ties to US president Donald Trump – is financially supporting the bid.

WBD’s board added that the offer from Netflix is well financed and offers better long-term value to shareholders.

In response to the recommendation from WBD, Netflix co-chief executive ted Sarandos,called the company’s merger agreement “superior” and “in the best interest of stockholders”.

Netflix also reiterated its