Zhi Tong Cai Jing·2026-01-07 13:15Core Viewpoint - Warner Bros. Discovery (WBD) has determined that Paramount's revised acquisition offer is inferior to its existing deal with Netflix (NFLX) and has urged its shareholders not to transfer shares to the "interloper" [1] Group 1: Acquisition Offers - Paramount's revised offer includes a plan to acquire shares at $30 each, with a higher breakup fee and a personal guarantee from billionaire Larry Ellison for $40.4 billion in equity financing [1] - Warner Bros. expresses concerns over Paramount's ability to complete the transaction, citing over $50 billion in debt financing as a significant risk factor [1][2] - Paramount has been attempting to acquire Warner Bros. for several months, prompting Warner Bros. to seek a sale last October [2] Group 2: Financial Implications - If Warner Bros. terminates its agreement with Netflix for Paramount's deal, it would incur costs totaling $4.7 billion, including a $2.8 billion breakup fee owed to Netflix and $1.5 billion in expenses from failed debt refinancing [2] - Even with a $5.8 billion termination fee from Paramount, Warner Bros. would only retain $1.1 billion after covering these costs [2] Group 3: Regulatory and Market Considerations - Paramount argues that its acquisition offer is superior and more likely to gain regulatory approval compared to Netflix's deal [3] - Warner Bros. believes both transactions have equal chances of passing regulatory scrutiny [3] - The valuation of Warner Bros.' cable networks, such as TNT and CNN, is a focal point, with Paramount estimating their value at $1 per share, while analysts suggest a higher valuation [3] Group 4: Strategic Positioning - Warner Bros. asserts that the merger with Netflix maximizes value while minimizing downside risk, aligning with shareholder interests [4]