Paramount Increases Offer for Warner Bros Discovery to Counter Netflix, Source Reports

• Paramount's revised bid improves on its initial $108.4 billion offer and includes backing from Oracle billionaire Larry Ellison, while competing against Netflix's $27.75 per share proposal
• Activist investor Ancora Capital, with a $200 million stake in Warner Bros, has threatened to vote against the Netflix deal and hold the board accountable if they refuse to engage with Paramount
• Any deal faces intense regulatory scrutiny from U.S. and European authorities, with concerns that a Netflix-Warner Bros combination would create the biggest global streaming player with roughly half a billion subscribers

Market Summary: Paramount Raises Warner Bros Discovery Bid in Streaming Battle

Key Developments

Paramount-Skydance has submitted an improved bid for Warner Bros Discovery (WBD), escalating its challenge to Netflix's pending acquisition. Paramount's revised offer enhances its initial $108.4 billion ($30 per share) proposal, though specific terms remain undisclosed. The bid comes ahead of a February 23 deadline set by WBD, which previously rejected Paramount's February 10 offer as inadequate.

Competing Offers

Netflix's current offer stands at $27.75 per share for WBD's studios and streaming assets. Paramount's bid, backed by Oracle billionaire Larry Ellison, includes coverage of the $2.8 billion Netflix termination fee and a 25-cent per share premium. MoffettNathanson analysts suggest an offer around $34 per share would be competitive.

Strategic Assets

The battle centers on coveted franchises including "Harry Potter" and "Game of Thrones," with HBO Max representing a significant streaming platform. WBD plans to spin off Discovery Global, containing cable assets like CNN and HGTG, potentially valued between $1.33 and $6.86 per share.

Market Implications

A Netflix-WBD combination would create the largest global streaming platform with approximately 500 million subscribers and challenge Disney's market leadership. However, either deal faces intense regulatory scrutiny from U.S. and European antitrust authorities. Lawmakers have expressed bipartisan concerns about market concentration and consumer impact.

Activist investor Ancora Capital, holding a $200 million WBD stake, is pressuring the board to reconsider Paramount's offer, threatening to vote against the Netflix deal.

Regulatory Concerns

The U.S. Department of Justice is examining potential anti-competitive practices, while Paramount claims a clearer regulatory path than Netflix. Control of CNN transferring to the conservative-leaning Ellisons adds political complexity to the transaction.