Paramount Skydance is staring down a key deadline in its pursuit of Warner Bros. Discovery, but it doesn’t need to make a move quite yet.
David Ellison and company have been able to negotiate directly with WBD’s leadership team in recent days for the first time in months — thanks to Netflix, Paramount’s rival in the bidding war.
Netflix granted WBD, its deal partner, a weeklong waiver on negotiation exclusivity that expires at midnight on Monday. The company said it hoped these talks between Paramount and WBD would “fully and finally resolve” the monthslong saga that it said has been an “ongoing distraction” for both Netflix and WBD shareholders.
As of midday Monday, Paramount hasn’t made its “best and final” bid for WBD, though it doesn’t necessarily have to rush. That’s because the seven-day window that Netflix granted Warner Bros. is to talk with Paramount, not the deadline for Paramount to raise its bid.
“Anyone can make an offer up to the shareholder vote,” a person familiar with the WBD-Paramount negotiations told Business Insider.
WBD’s shareholder vote is on March 20. At that meeting, investors can choose to either approve or reject the Netflix deal, or they can abstain. WBD shareholders who prefer Paramount’s offer can tender their shares to Ellison and company. Paramount has set a March 2 deadline for that, though it could be extended. If Paramount gets a majority of shares, it could shift WBD’s course toward its own offer over Netflix’s.
That means Paramount’s real deadline for submitting its best offer is weeks away, though the company could raise its bid well before that. If Paramount raises its offer, Netflix will have four days to respond.
WBD has said it prefers Netflix’s all-cash offer of $27.75 per share for its studio and streaming assets over Paramount’s proposal of $30 per share for the entire company, including its cable TV networks.
WBD warned last week that if it went with Paramount, its employees could quit in droves, ahead of what could be a major round of layoffs under Ellison. Paramount has said it plans to create $6 billion in cost savings, which would include layoffs, compared to $2 billion or $3 billion from Netflix.
Paramount has argued that Netflix is the biggest threat to Hollywood since it has the most streaming subscribers and dominates viewership share among paid streamers. Netflix’s counterargument is that it also competes against YouTube and other free streamers.
President Donald Trump is another variable. Trump said in December that Netflix’s acquisition of Warner Bros. “could be a problem” due to its market share, before saying in early February that he had decided he “shouldn’t be involved” in the regulatory process.
A White House spokesperson told Business Insider last week that Trump “has great relationships with all parties in this potential transaction and remains neutral in this process with no preference for either bidder.”
Then on Saturday, Trump said Netflix should remove Susan Rice from its board “or pay the consequences.” On a podcast, Rice, a former senior White House official under Obama and Biden, criticized the Trump administration and companies that “take a knee” under pressure from the president.
Netflix co-CEO Ted Sarandos shrugged off the president’s remarks on Monday, saying that the streaming titan’s bid for Warner Bros. is “not a political deal.”
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