Netflix Will Purchase Warner Bros. Discovery for $83 Billion; Paramount Cries Foul Over Bidding Process

Streaming behemoth Netflix said on Friday that they will purchase Warner Bros. Discovery’s Studio and Streaming business, a deal that values the assets at $82.7 billion.The agreement, which includes cash and stock, is expected to close after WBD carves out its cable offerings by the third quarter of next year, according to the New York Times. The sale of the movie studio to the world’s largest streaming service cements the conquest of Hollywood by the Tech Sector.“Together, we can give audiences more of what they love and help define the next century of storytelling,” Netflix’s co-chief executive, Ted Sarandos, said in a statement.Netflix’s pitch turned heads by promising something the streaming giant has long resisted — theatrical releases for Warner Bros. Discovery films. It’s a striking about-face for the company that revolutionized at-home viewing and has spent years keeping the theatrical releases at arm’s length.Netflix won a bidding war with Comcast and Paramount Skydance with an initial offer of $28 per share, making them the frontrunner. This week, Paramount’s legal team raised concerns about whether the sale process has been conducted fairly and adequately, according to a letter obtained by CNBC. Warner Bros also holds the rights to major franchises such as Harry Potter and Game of Thrones, along with the HBO Max streaming platform.Paramount’s legal representatives informed Warner Bros. Discovery CEO David Zaslav that they had doubts about whether the process, which began formally in October, was being handled fairly and appropriately. Earlier this week, Paramount, Netflix, and Comcast all put forward second-round offers to purchase either portions of or the entirety of Warner Bros. Discovery’s assets.“It has become increasingly clear, through media reporting and otherwise, that WBD appears to have abandoned the semblance and reality of a fair transaction process, thereby abdicating its duties to stockholders, and embarked on a myopic process with a predetermined outcome that favors a single bidder,” reads the letter. “We specifically request and expect this letter will be shared and discussed with the full board of directors of WBD.”In October, Paramount proposed purchasing the entire company at $24 per share, along with assets like its cable networks including CNN, but Warner Bros turned down the offer before deciding to pursue a sale.Paramount put forward a revised offer on Thursday, valued at approximately $27 per share, according to a report from CNN.The bid from Netflix was comprised of mostly cash while Paramount had offered all cash. Netflix became the front-runner due to how they valued their offered, people familiar with the bid told CNBC.“Please be assured that the WBD Board attends to its fiduciary obligations with the utmost care, and that they have fully and robustly complied with them and will continue to do so,” the company said in its response to Paramount’s letter.

Netflix Will Purchase Warner Bros. Discovery for $83 Billion; Paramount Cries Foul Over Bidding Process

Netflix Will Purchase Warner Bros. Discovery for $83 Billion; Paramount Cries Foul Over Bidding Process

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