In the ongoing contest for control of Warner Bros Discovery (NASDAQ: WBD), Netflix Inc. (NASDAQ: NFLX) co-CEO Greg Peters has openly criticized the rival bid from Paramount Skydance (NASDAQ: PSKY), labeling the $108 billion hostile offer as unrealistic without the financial involvement of Oracle founder Larry Ellison (NYSE: ORCL). Peters highlighted concerns over the substantial leverage implied in the Paramount proposal and contrasted it sharply with Netflix's own $82.7 billion all-cash offer.
In a recent interview conducted by the Financial Times, Peters described Paramount's aggressive acquisition plan as questionable, asserting that it "doesn't pass the sniff test". His skepticism centers on the notion that Paramount's bid depends on significant debt financing in addition to Ellison's backing, which would expose the transaction to considerable risks. He referred to the added borrowing required for Paramount’s acquisition as "pretty crazy," implying that it amplifies financial instability compared to Netflix’s cash-provisioned approach.
Paramount Skydance, having failed to secure endorsement from Warner Bros Discovery's board, moved to appeal directly to WBD shareholders with their offer. Yet, initial indicators suggest the bid has been met with tepid enthusiasm. Proxy statements reveal that Paramount has obtained only about 7% of WBD shares, a fraction far from the majority control needed to sway the outcome.
The prospect of a merged entity involving Netflix and Warner Bros Discovery has potential implications extending across Hollywood’s competitive landscape. This union would combine heavyweight intellectual properties, blending Warner Bros’ major franchises such as "Game of Thrones" and "Harry Potter" with Netflix’s popular series including "Stranger Things" and "Squid Game." The deal has generated apprehension among key stakeholders—filmmakers, labor unions, and movie theater operators—all concerned about the evolving influence of streaming platforms on traditional theatrical distribution.
Addressing these apprehensions, Peters assured industry participants that Netflix intends to maintain Warner Bros’ longstanding 45-day theatrical release window. This statement seeks to mitigate fears that the streaming giant’s acquisition might diminish cinema exhibition opportunities.
Both the U.S. and European regulators are expected to undertake close reviews of the competing acquisition bids, assessing their broader competitive implications. Within this context, Peters emphasized the competitive dynamics faced by Netflix, noting that the streaming service competes with diverse digital platforms including YouTube (owned by Alphabet Inc., NASDAQ: GOOG/GOOGL), Amazon (NASDAQ: AMZN), and Apple (NASDAQ: AAPL). For perspective, he pointed out that Netflix represents less than 10% of TV viewing time in most markets, positioning the company as a single participant in a crowded arena.
Regarding market reaction, Netflix shares have experienced a decline, falling by 2.13% during Thursday’s market session. Over the past month, the stock has dropped approximately 10.65%. According to data compiled by Benzinga’s Edge Stock Rankings, Netflix currently exhibits negative trends across short-, medium-, and long-term price performance metrics, accompanied by low Momentum and Value scores.
Peters’ remarks and Netflix’s response to the Paramount offer underline the intensifying strategic maneuvers within the media sector as companies seek to consolidate assets and expand their footprint in the competitive streaming and content creation space. The acquisition battle not only reflects the complexities intertwined with financing and shareholder alignment but also signals ongoing transformations in how audiences consume entertainment content globally.
In a recent interview conducted by the Financial Times, Peters described Paramount's aggressive acquisition plan as questionable, asserting that it "doesn't pass the sniff test". His skepticism centers on the notion that Paramount's bid depends on significant debt financing in addition to Ellison's backing, which would expose the transaction to considerable risks. He referred to the added borrowing required for Paramount’s acquisition as "pretty crazy," implying that it amplifies financial instability compared to Netflix’s cash-provisioned approach.
Paramount Skydance, having failed to secure endorsement from Warner Bros Discovery's board, moved to appeal directly to WBD shareholders with their offer. Yet, initial indicators suggest the bid has been met with tepid enthusiasm. Proxy statements reveal that Paramount has obtained only about 7% of WBD shares, a fraction far from the majority control needed to sway the outcome.
The prospect of a merged entity involving Netflix and Warner Bros Discovery has potential implications extending across Hollywood’s competitive landscape. This union would combine heavyweight intellectual properties, blending Warner Bros’ major franchises such as "Game of Thrones" and "Harry Potter" with Netflix’s popular series including "Stranger Things" and "Squid Game." The deal has generated apprehension among key stakeholders—filmmakers, labor unions, and movie theater operators—all concerned about the evolving influence of streaming platforms on traditional theatrical distribution.
Addressing these apprehensions, Peters assured industry participants that Netflix intends to maintain Warner Bros’ longstanding 45-day theatrical release window. This statement seeks to mitigate fears that the streaming giant’s acquisition might diminish cinema exhibition opportunities.
Both the U.S. and European regulators are expected to undertake close reviews of the competing acquisition bids, assessing their broader competitive implications. Within this context, Peters emphasized the competitive dynamics faced by Netflix, noting that the streaming service competes with diverse digital platforms including YouTube (owned by Alphabet Inc., NASDAQ: GOOG/GOOGL), Amazon (NASDAQ: AMZN), and Apple (NASDAQ: AAPL). For perspective, he pointed out that Netflix represents less than 10% of TV viewing time in most markets, positioning the company as a single participant in a crowded arena.
Regarding market reaction, Netflix shares have experienced a decline, falling by 2.13% during Thursday’s market session. Over the past month, the stock has dropped approximately 10.65%. According to data compiled by Benzinga’s Edge Stock Rankings, Netflix currently exhibits negative trends across short-, medium-, and long-term price performance metrics, accompanied by low Momentum and Value scores.
Peters’ remarks and Netflix’s response to the Paramount offer underline the intensifying strategic maneuvers within the media sector as companies seek to consolidate assets and expand their footprint in the competitive streaming and content creation space. The acquisition battle not only reflects the complexities intertwined with financing and shareholder alignment but also signals ongoing transformations in how audiences consume entertainment content globally.