Sources familiar with the matter revealed that Paramount Global has more than doubled the proposed breakup fee in its acquisition offer for Warner Bros. Discovery to $5 billion. This move aims to make its bid more attractive and outmaneuver competing suitors.
The substantial fee, payable to Warner Bros. if a deal is agreed upon but ultimately fails to close, demonstrates Paramount's confidence in securing regulatory approval for the merger. The company's previous breakup fee proposal stood at $2.1 billion.
Warner Bros. Discovery, parent company of HBO and CNN, is currently evaluating takeover offers from three media giants—Paramount, Netflix, and Comcast—with a potential buyer selection expected in coming weeks. The company received second-round bids this Monday and has since been in discussions with interested parties.
Paramount, which owns CBS, MTV, and other media assets, has repeatedly made unsolicited offers for Warner Bros., sparking a bidding war. Warner Bros. formally initiated its sale process in October.
To date, Paramount has submitted five acquisition proposals. The company seeks to acquire Warner Bros. in its entirety, while Netflix and Comcast's plans involve spinning off Warner's cable network business. Paramount argues that such spin-offs would create taxable events for Warner Bros., making its all-inclusive offer more financially appealing.
All three bidders would face regulatory scrutiny, raising concerns about potential Hollywood job losses, though Paramount remains the smallest among them. Comcast generates the highest revenue, while Netflix boasts the largest market capitalization.
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