. The audiovisual production company, directed by David Ellison, has opened a new chapter in the battle it maintains to take over its rival Netflix. Paramount has sent a letter to the shareholders of the historic film studios, owner of one of the largest audiovisual archives in the world, to remind them of the benefits of its hostile takeover, which consists of an offer of $30 per share. A proposal that raises the operation to about 108.4 billion dollars. The group led by Ellison keeps the takeover intact, despite the fact that its lawyers showed themselves willing to improve it during preliminary talks. But above all, Paramount has announced a lawsuit against Warner leadership in court to detail the agreement it has signed with .
“This morning we filed a complaint in the Delaware Court of Chancery to ask the court to simply order Warner Bros. Discovery (WBD) to provide the information (about the agreement with Netflix) so that WBD shareholders have what they need to make an informed decision about whether to tender their shares in our offer,” Ellison wrote in the letter to shareholders.
“Warner has provided increasingly novel reasons to avoid a transaction with Paramount, but what it has never said, because it cannot, is that the transaction with Netflix is financially superior to our real offer,” says the document signed by David Ellison, who has the support of his father, the founder of Oracle and one of the richest men in the world, Larry Ellison. “Our $30 per share in cash is simply more than Netflix’s complex multi-variable consideration of $23.25 in cash plus a number of Netflix shares currently worth $4.11, plus the Global Networks equity that will be issued and which we have analyzed as having zero equity value,” he adds.
Although Paramount’s offer appears apparently greater than that of Netflix, of 72,000 million, including debt, it must be taken into account that the largest streaming platform streaming in the world only buys movie studios and HBO. The group led by Ted Sarandos leaves the entire business of streaming from Warner that includes the news channel CNN and all the channels of streaming of Discovery, which analysts value between two and four dollars per share.
“In addition to not disclosing the value of the Global Networks spin-off to be issued, WBD has not disclosed the mechanism by which any debt transferred from Global Networks to the segment Streaming & Studios reduces the consideration in cash and shares that must be paid,” explains Ellison.
With sagas like Harry Potter or the lord of the rings and historical films like Casablanca, The Godfather, Citizen Kane o Gone with the windl.
Warner Bros. Discovery’s board of directors last week rejected Paramount’s improved offer that included a $40 million personal guarantee from Larry Ellison.
Warner leadership considers that Netflix’s proposal is more advantageous because it offers more collection guarantees, with a better financially structured offer. In addition, it plans to segregate the streaming business that Netflix does not want to take it public.
Warner directors do not want to be a mere troupe in the battle. They have opened talks with Soo Kim, founder of the New York hedge fund Standard General, for the possible sale of the streaming business that includes the main ones, which includes CNN.
