Paramount Accuses Warner Bros.Discovery of Unfair Sale Process
A battle for control of Warner Bros. Discovery (WBD) is escalating, with Paramount Global accusing WBD of prioritizing a deal with Netflix over a potentially more valuable offer from Paramount. The accusations,made late Wednesday by Paramount’s legal team,allege WBD abandoned a fair transaction process in favor of a “predetermined outcome.”
The conflict began in September when Paramount, recently acquired by Skydance Media and RedBird Capital Partners under the ownership of the Ellison family, initiated a bid to purchase WBD, which owns HBO and CNN. However, WBD’s board rejected Paramount’s initial overtures and opened the sale process to other bidders, including Netflix and Comcast (owner of nbcuniversal).
Recent developments have reportedly shifted the advantage to netflix, which is offering a largely cash-based bid. Initially, analysts believed Paramount’s strong ties to President Trump – and a potential endorsement from trump himself – would expedite regulatory approval. Trump publicly stated his preference for paramount winning the acquisition, potentially allowing the ellison family to control both CBS News and CNN.
Though, concerns arose internationally. A source close to the auction indicated that foreign leaders wary of Trump expressed unease over the Ellisons gaining important control over U.S. media.
Paramount’s letter specifically cites a recent meeting in Brussels between WBD international executive Gerhard Zeiler and European Commission officials, including Vice President Henna Virkkunen. According to a report in a German newspaper, concerns were raised during the meeting that a merger between WBD and Paramount, under Ellison family ownership, could lead to excessive media concentration, potentially prompting intervention from the E.U. Commission. Paramount argues this meeting demonstrates “tacit resistance to, if not active sabotage of, a Paramount offer.”
WBD responded Thursday, asserting its board is diligently fulfilling its fiduciary obligations and will continue to do so.
Paramount also points to media reports suggesting WBD’s preference for a Netflix acquisition, which would create a powerful streaming and traditional media entity.Netflix has declined to comment on the situation.
Paramount maintains its offer would deliver the greatest value to WBD stockholders and is demanding assurances of a fair and autonomous process. The company stated it “remains confident” and intends to continue engaging in the process, while insisting on steps to ensure impartiality for both Paramount’s benefit and the interests of WBD’s stockholders.
