Warner Bros Acquisition Battle 'Mud Fight'…Paramount Halts Netflix

In the competition for the acquisition of Warner Bros Discovery (hereinafter Warner Bros), Paramount Skydance (hereinafter Paramount) has confirmed that it has officially protested to Warner Bros regarding the fairness of the bidding process.

According to reports from major U.S. media outlets such as Bloomberg and CNBC on the 4th (local time), Paramount's legal representative made it clear in a letter sent to David Zaslav, CEO of Warner Bros, that the current bidding process is being conducted in favor of Netflix.

In the letter, Paramount pointed out that "Warner Bros has violated the basic principles of fair trading procedures and has neglected its duty to protect shareholder value." It further criticized that "a biased procedure is being conducted with a predetermined outcome favorable to a specific bidder."

Among the three companies that entered the Warner Bros acquisition battle, it is reported that Netflix submitted a second bid on the 1st, mostly composed of cash.

Bloomberg reported that the proposed amount from Netflix exceeds Paramount's offer.

Reuters quoted sources stating that Netflix submitted the highest bid among the three competitors. CNBC reported that Netflix proposed to pay 85% of the value of the target assets in cash.

Paramount raised questions about whether Warner Bros has formed an independent special committee to manage the sale process composed of board members without conflicts of interest. It also claimed that the current sale process has been compromised due to "potential conflicts of interest of some executives."

In response, Warner Bros confirmed that it has conveyed the contents of Paramount's letter to the board of directors.

A spokesperson for Warner Bros stated, "The board is carrying out its duties as carefully as possible and will continue to do so in the future."

Led by David Ellison, son of Oracle founder Larry Ellison, Paramount is actively pursuing the acquisition of Warner Bros.

It is reported that Paramount had already made an acquisition proposal to Warner Bros before the official bidding began, but it was rejected.

Warner Bros, which was launched in 2022 through the merger of WarnerMedia and Discovery, operates multiple cable channels including film and TV production studios and the streaming platform HBO Max, CNN, TNT, and Discovery.

Warner Bros announced a restructuring plan in June to separate the streaming and studio divisions and the cable broadcasting division into separate entities by next year.

Reuters predicted that the sale of Warner Bros, a major Hollywood company, would significantly change the landscape of the media industry.