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Paramount is suing Warner Bros Discovery over Netflix deal

Paramount Skydance CEO David Ellison won't take No
Paramount Skydance CEO David Ellison won't take No
14 Jan - Paramount Skydance (PSKY) is not taking no for an answer from Warner Bros Discover (WBD), as it has now decided to sue the latter as a way to force it to disclose the financial details of its USD 83 billion deal with Netflix.

In an open letter to WBD shareholders on 12 January, PSKY's CEO David Ellison accused the company of failing to include any disclosure about "how it valued the Global Networks stub equity and the overall Netflix transaction, how the purchase price reduction for debt works in the Netflix transaction, or even what the basis is for its 'risk adjustment' of our USD 30 per share all-cash offer."

The decision to sue came after WBD board rejected PSKY's eighth and latest offer of USD 30 per share all-cash bid for its entirety, saying that Netflix's USD 27.75 per share for Warner Bros films and TV studios, HBO and HBO Max and games division was a better deal.
Warner Bros Discovery's current CEO is David Zaslav
Warner Bros Discovery's current CEO is David Zaslav
PSKY stated that WBD has provided increasingly novel reasons for avoiding a transaction with them, but has never said that the Netflix ⁠transaction is financially superior to PSKY's actual offer.

"Make no mistake, our goal remains to have constructive discussions with WBD's Board to reach an agreement that is in the best interests of WBD shareholders. ... We remain perplexed that WBD never responded to our December 4th offer, never attempted to clarify or negotiate any of the terms in that proposal, nor traded markups of contracts with us," Ellison added.

Meanwhile, in a statement to the media, WBD called the lawsuit meritless as PSKY has yet to raise the price of its offer to acquire WBD.

"Despite six weeks and just as many press releases from Paramount Skydance, it has yet to raise the price or address the numerous and obvious deficiencies of its offer. Instead, Paramount Skydance is seeking to distract with a meritless lawsuit and attacks on a board that has delivered an unprecedented amount of shareholder value. In spite of its multiple opportunities, Paramount Skydance continues to propose a transaction that our board unanimously concluded is not superior to the merger agreement with Netflix."
WBD says PSKY has yet to make a better offer than Netflix
WBD says PSKY has yet to make a better offer than Netflix




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