Paramount Skydance Corporation has confirmed that it has been notified by Warner Bros. Discovery, Inc. that its $31-per-share, all-cash proposal to acquire WBD is a “Company Superior Proposal” under the terms of WBD’s merger agreement with Netflix, Inc.
Here are the winning terms of Paramount’s proposed merger agreement:
- Paramount will acquire WBD for $31.00 per WBD share in cash for 100% of the company;
- A daily “ticking fee” of $0.25 per quarter will accrue after September 30, 2026, until the consummation of the Paramount transaction;
- A regulatory termination fee of $7 billion would be payable in the event the transaction does not close due to regulatory matters;
- Paramount will pay the $2.8 billion termination fee which WBD is required to pay to Netflix to terminate its existing Netflix merger agreement;
- Paramount will eliminate WBD’s potential $1.5 billion financing cost associated with its debt exchange offer;
- The “Company Material Adverse Effect” definition excludes the performance of WBD’s Global Linear Networks business;
- The Ellison Trust is providing a $45.7 billion equity commitment, and Larry Ellison is guaranteeing such commitment, including an obligation to contribute additional equity funding to Paramount to the extent needed to support the solvency certificate required by Paramount’s lending banks, and
- Bank of America Merrill Lynch, Citi and Apollo are providing a $57.5 billion debt commitment.
The proposed transaction requires the expiration of a four-business-day match period, termination of the Netflix merger agreement, and execution of a definitive merger agreement between Paramount and WBD.
David Ellison, Chairman and CEO of Paramount, said: “We are pleased WBD’s Board has unanimously affirmed the superior value of our offer, which delivers to WBD shareholders superior value, certainty and speed to closing.”
Netflix shares jumped more than 9% premarket on Friday, while Paramount rose around 10% following the announcement.
By CEO NA Editorial Staff
