Paramount boosts WBD bid without increasing per-share value

Paramount recently made some updates to its bid for Warner Bros. Discovery, adding a “ticking fee” and covering the termination fee that would be owed to Netflix if the deal falls through. The offer remains at $30 per share in cash for WBD shareholders. Paramount CEO David Ellison emphasized the company’s commitment to providing full value to shareholders with this offer.

The “ticking fee” is designed to compensate WBD shareholders for any delays in regulatory approval for the Paramount-WBD merger. Paramount has set the fee at 25 cents per share, per quarter after the end of 2026 if the deal is not closed by then. This fee highlights Paramount’s confidence in the regulatory approval process.

In addition to the ticking fee, Paramount has also pledged to fund the $2.8 billion termination fee owed to Netflix and eliminate a potential $1.5 billion debt refinancing cost. The revised offer, which includes these new elements, is fully financed by equity commitments from the Ellison family and RedBird Capital Partners, as well as debt commitments from Bank of America, Citigroup, and Apollo.

Warner Bros. Discovery acknowledged the amended offer and stated that the board would review and consider it. While the board had previously recommended rejecting Paramount’s offer, RedBird Capital Partners’ Gerry Cardinale expressed confidence in the alignment of their deal with delivering the best value and certainty to shareholders.

Netflix’s proposed acquisition of WBD assets is still in the works, with the deal expected to close after the separation of WBD’s TV networks in the third quarter of 2026. Last month, Netflix adjusted its offer to $27.75 per share in cash, addressing antitrust concerns that have been raised. Paramount’s revised offer aims to compete with Netflix’s proposal while emphasizing regulatory confidence and value for shareholders.

Overall, the competition between Paramount, RedBird Capital Partners, and Netflix for Warner Bros. Discovery highlights the evolving landscape of streaming entertainment and the strategic decisions being made in the industry. Stay tuned for further developments as the acquisition process unfolds.