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Warner Bros. Urges Investors to Reject Paramount Bid скачать в хорошем качестве

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Warner Bros. Urges Investors to Reject Paramount Bid
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Warner Bros. Urges Investors to Reject Paramount Bid

Warner Bros. Discovery Inc., the parent of HBO and CNN, advised its shareholders to reject a hostile takeover bid by Paramount Skydance Corp. in favor of its original agreement with streaming giant Netflix Inc., deeming the Paramount offer “inferior” and “inadequate.” Geetha Rangathan joins to discuss the latest on the Warner Brothers bidding war with Paul Sweeney and Scarlet Fu. Paramount, the parent of CBS and Nickelodeon, has been appealing directly to Warner Bros. shareholders with an offer to buy the whole company after the Warner Bros. board agreed to sell its streaming and studios businesses to Netflix. Warner Bros. plans to spin its cable networks, like CNN and TNT, into a separate company before completing the Netflix deal.  Warner Bros. raised several concerns about the Paramount offer, including its uncertain financing and the risk that Paramount could terminate the deal at any time. Paramount has offered $30 a share in cash for the whole company, including its cable networks. Under the Netflix deal, Warner Bros. shareholders will get $27.75 a share in cash and Netflix stock, as well as shares in the new company that will hold the Warner Bros. cable networks. In response to a letter Warner Bros. board sent to shareholders Wednesday, Paramount reaffirmed its commitment to buy the company for $30 a share.  “Our proposal clearly offers Warner Bros. shareholders superior value and certainty, a clear path to close, and does not leave them with a heavily indebted sub-scale linear business,” Paramount Chief Executive Officer David Ellison said in a statement. “I have been encouraged by the feedback we have received from Warner Bros. shareholders who clearly understand the benefits of our offer.” Paramount, controlled by software billionaire Larry Ellison and his son David, is competing with the most valuable entertainment company in the world to acquire Warner Bros., one of Hollywood’s most storied studios, as well as HBO, one of the crown jewels of the TV business. Executives from both Paramount and Netflix have argued that they would be the best owners and utilize the coveted Warner Bros. library to boost their streaming operations. In its letter and a detailed 94-page regulatory filing, the board flagged risks in the Paramount offer, including the Ellison family’s failure to adequately backstop their $40.7 billion equity commitment. The equity is supported by “an unknown and opaque revocable trust,” the board said. The documents Paramount provided “contain gaps, loopholes and limitations that put you, our shareholders, and our company at risk.” The Warner Bros. board said Paramount has “consistently misled” shareholders when it said its proposal had a “full backstop” by the Ellison family. The board said if Paramount’s proposed deal were to close, it would carry a debt load nearly 7 times larger than the combined company’s earnings before interest, taxes, depreciation and amortization. “Such debt levels reflect a risky capital structure that is vulnerable to even potentially small changes” in Paramount or Warner Bros.’ business between signing and closing, according to the letter. The latest offer from Paramount included $54 billion in debt commitments from Bank of America Corp., Citigroup Inc. and Apollo as well as plans to raise $41 billion in equity. It’s been previously reported that includes $11.8 billion from the Ellison family, $24 billion from three Middle East sovereign wealth funds and additional financing from RedBird Capital Partners. Affinity Partners, the investment firm founded by President Donald Trump’s son-in-law Jared Kushner withdrew from the process on Tuesday. Paramount’s proposal will also require Warner Bros. to pay a $2.8 billion breakup fee to Netflix.  The Paramount offer “remains inferior to the Netflix merger,” Warner Bros. wrote. The board unanimously recommended the Netflix deal, saying “the terms of the Netflix merger are superior,” while the Paramount offer “provides inadequate value and imposes numerous, significant risks and costs.” Netflix issued a letter to Warner Bros. shareholders on Wednesday morning reiterating why it’s offer is better and urging them to approve the agreement. -------- Get more on The Bloomberg Intelligence Podcast On Apple: http://bit.ly/3YrBfOi On Spotify: http://bit.ly/3SPPZ8F Anywhere: http://bit.ly/43hOc0r Follow us on X:   / bloombergradio   Listen on Apple CarPlay and Android Auto with the Bloomberg Business app: Apple CarPlay: https://apple.co/486mghI Android Auto: https://bit.ly/49benZy Visit our YouTube channels: Bloomberg Podcasts:    / bloombergpodcasts   Bloomberg Television:    / @markets   Bloomberg Originals:    / bloomberg   Quicktake:    / @bloombergquicktake  

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