Paramount calls the Warner Bros. Discovery sale process “unfair”

As if it were a plot twist in a Hollywood movie, Paramount Skydance turns history upside down criticizing the form in which Warner Bros. Discovery this carrying out your sales process.

The bid to acquire the conglomerate led to a second round this week, receiving new and improved purchase proposals from its main bidders: Paramount, Comcast y Netflixto acquire part or all of WBD's assets, in a second round that had the deadline of last Monday, December 1.

The sales process began in October, and the receipt of the initial offers from the three main bidders mentioned was on November 20.

Paramount Skydance, owned by David Ellison, sent a letter to the board of directors of Warner Bros. Discoveryquestioning whether the company run by David Zaslavyou are conducting an unbiased sales process.

Lawyers for Warner Bros. Discovery responded to the letter, deflecting concerns and stating:

“I assure you that the WBD board of directors fulfills its fiduciary obligations with the utmost care, has fulfilled them fully and rigorously, and will continue to do so.”

In the letter, Paramount suggests Netflix has received the most favorable treatment so far.

Netflix is ​​interested in acquiring the studio and streaming business (the study Warner Bros., HBO y HBO Max), while Paramount aims for a full acquisition that also include cable channel division (TNT, TBS, CNN, HGTV and Food Network). The most recent offer of Comcast would imply the spin-off of NBCUniversal and Warner Bros. discovery, in what would likely be a high-volume transaction.

Paramount goes on to say in the letter (published in full by CNBC):

“Several US media outlets have reported on WBD management's enthusiasm for a transaction with Netflix, and on statements by management that a transaction between WBD and Netflix would be a smash hit, while referring negatively to the Paramount bid. Additional reporting since the submission of the revised bids on December 1 indicates that WBD's board of directors has been very enthusiastic about a transaction with Netflix due to the chemistry between WBD and Netflix management.”

POINTS TO HIGHLIGHT:

• Netflix has presented a mostly cash offerwhile Paramount's latest offering was entirely in cashaccording to reports from CNBC.
• Until Thursday morning, Netflix was the main bidderaccording to the valuation that WBD is doing of the offers.
• Los Comcast executivesfor its part, they remain disciplined with the offer of the company so as not to anger shareholders by taking on additional debt and risking its balance sheet, according to people familiar with the company's strategy. Comcast management has previously stated that your standards for mergers and acquisitions are generally tall.

Las regulatory concerns They appear to be a critical factor in any possible agreement.

On the other hand, it is reported that Trump's Justice Department prepares for a possible agreement between WBD and Netflix, planning an investigation and possibly a lawsuit to try to block it, given the possible merger of Netflix and HBO Max.

Comcast has been left out of the conversation for now. The letter and the administration leaks suggest that Netflix has become the preferred option over NBCUniversaland that Paramount is not willing to sit idly by in front of the so-called “streaming giant.”

Paramount's bid for Warner Bros. is believed to be backed by Oracle founder, Larry Ellison (net worth: $266 billion), to boost the bid of his son, David Ellison, who last August closed a deal valued at $8 billion for the merger of Skydance Media with Paramount.

WBD hopes to announce a winner next week.