Warner Bros Discovery Inc (NASDAQ:WBD, XETRA:J5A) is reportedly set to reject Paramount Skydance’s (NASDAQ:PSKY) amended $108.4 billion hostile bid, according to CNBC.
The decision would effectively set aside Paramount’s efforts to strengthen its financing through a $40.4 billion personal guarantee from Oracle co-founder Larry Ellison.
Paramount had revised its offer to address concerns from WBD’s board, including a personal equity backstop from Ellison, an increased regulatory reverse termination fee, and an extended tender offer deadline.
The all-cash bid valued WBD shares at $30 each.
Despite these adjustments, WBD appears to remain focused on its previously announced cash-and-stock deal with Netflix.
The company cited concerns about Paramount’s proposal related to valuation, strategic fit, financing certainty, and regulatory risk. Sources indicate that WBD views the Netflix combination as offering greater long-term value and deal certainty for shareholders.
Paramount’s bid, while higher in nominal value than the Netflix agreement, has faced scrutiny due to the complexity of its financing and the perceived opacity of Ellison’s guarantee.
Shares of Warner Bros. Discovery traded hands at about $29 on Tuesday. Paramount Skydance shares were up 1.4% at about $14, while Netflix stock was down 0.4% at $94.