Paramount ups offer for Warner Bros, eyes Harry Potter, Game of Thrones, in bidding war with Netflix

Paramount Skydance has raised the stakes in the bidding war for Warner Bros Discovery, submitting a higher offer to counter Netflix’s attempt to secure the company. This latest move comes as Paramount seeks to outbid Netflix and secure control of one of Hollywood’s most valuable assets, which includes the iconic “Harry Potter” and “Game of Thrones” franchises.

As the competition intensifies, the outcome of this battle could reshape the market dominance of streaming services.

What's Paramount's new offer?

Paramount's new bid improves upon its initial offer of $108.4 billion, or $30 per share, addressing Warner Bros’ concerns about the certainty of financing. However, the details of the revised offer remain unclear. Warner Bros, which has favoured Netflix’s offer of $27.75 per share in cash, is allowed to match any higher bid. While Netflix has ample cash to increase its offer, Paramount’s bid is backed by Oracle billionaire Larry Ellison.

The bidding process hit a key moment when Paramount was asked to submit its "best and final offer" after Warner Bros rejected an enhanced bid that included paying Netflix’s $2.8 billion termination fee. Paramount was also given a seven-day deadline to improve its offer, which culminated in this latest round of increased bidding.

Industry analysts believe that a final offer from Paramount in the $ 34-per-share range would end the bidding war and avoid prolonged disputes over the company’s value. Meanwhile, Warner Bros is planning to spin off its cable TV assets, which may add significant value to the deal. However, Paramount has questioned the worth of the cable spinoff central to Netflix’s offer.

Pressure rises on Warner Bros

The pressure on Warner Bros has intensified, especially after activist investor Ancora Capital acquired a $200 million stake and criticised the company's engagement with Paramount. This has added more urgency to the decision, with Warner Bros shareholders set to vote on Netflix’s offer on March 20.

The deal, however, still faces significant regulatory scrutiny. U.S. and European competition authorities will closely examine the combined power of Netflix’s global streaming presence and Warner Bros’ movie studio assets to ensure the deal does not reduce competition. Paramount, which claims it has a clearer path to regulatory approval, is preparing for regulatory reviews in the U.S., EU, and UK.

This high-stakes battle could ultimately reshape the landscape of Hollywood and streaming services, making it a critical moment for the future of both companies.

(With inputs from Reuters)