Warner Bros. Weighs Revised Paramount Offer

TNT Sports parent company Warner Bros. Discovery said late Tuesday that the revised acquisition bid from Paramount could lead to a “company superior proposal.” 

WBD said that the revised bid for all of WBD was $31 per share, plus a daily a ticking fee of $.25 per quarter beginning after Sept. 30, as well as a $7 billion termination fee if the deal doesn’t close due to regulatory issues. 

Despite that, WBD did not make assurances that the Paramount bid is in fact the better offer.

“WBD will engage further with Paramount to determine if a proposal that constitutes a ‘company superior proposal’ … can be reached,” WBD said.

As expected, the CBS Sports parent company met the Monday 11:59 p.m. ET deadline to provide its “best and final” offer for all of WBD. Further updates are likely later this week as Paramount will report its latest quarterly earnings on Wednesday, and WBD will do the same on Thursday. Netflix’s $83 billion deal to buy WBD’s studios and streaming business—originally struck in December and recently converted to an all-cash structure—is still in place, at least for now.

“The Netflix merger agreement remains in effect, and the board continues to recommend in favor of the Netflix transaction,” WBD said early Tuesday. “WBD shareholders are advised not to take any action at this time with respect to the amended Paramount tender offer.”

A WBD shareholder vote on the Netflix deal is scheduled for March 20. If WBD’s board were to pivot and instead deem the new Paramount offer superior, Netflix will have four days to respond. 

WBD, with Netflix’s blessing, agreed to give Paramount a week to make an improved bid for the entire company after having spurned many unsolicited offers.

There are significant sports media implications, regardless of how this ends, as the fate of TNT Sports hangs in the balance. In the Netflix deal, the operation would separate from WBD as part of a planned Discovery Global spin-off and embark on a separate, independent path from the WBD assets acquired by Netflix. In a Paramount deal, though, the entire company would be acquired, and the TNT Sports operations would be blended with those of CBS Sports.

Even before the latest Paramount bid arrived, Netflix co-CEO Ted Sarandos made a public relations push against the rival effort, criticizing it in several recent interviews.

“Our deal is growth,” Sarandos told the BBC. “In the other model, in the Paramount model, it’s the classic horizontal media merger that is always bad for consumers, always bad for creators, because basically they’re just taking two studios and collapsing them into one.”