Warner Bros. Discovery Board Shuts Down Paramount’s Revised Hostile Takeover Push

(Chris Pizzello/Invision/AP photo)

Warner Bros. Discovery board members delivered a blunt rejection of Paramount’s revised hostile takeover bid on Wednesday, warning investors the offer was “inadequate” and still too risky.

In a letter to shareholders on Wednesday, obtained and first reported by CNN, the WBD board rejected Paramount’s revamped bid, insisting it falls well short of the certainty offered by its existing deal with Netflix.

Despite Paramount’s efforts to sweeten the offer, the board said the proposal “poses materially more risk for WBD and its shareholders” than the “certainty of the Netflix merger.”

“To effect the transaction, it intends to incur an extraordinary amount of incremental debt – more than $50 billion – through arrangements with multiple financing partners,” the board wrote.

Paramount has leaned heavily on the backing of Oracle billionaire Larry Ellison, who is bankrolling a large portion of the proposed $78 billion transaction. His son, Paramount CEO David Ellison, ignited the takeover battle last year with an unsolicited bid that included CNN and other assets.

WBD CEO David Zaslav, instead ran a formal auction and accepted Netflix’s offer of $27.75 per share in a deal the board is standing by. Paramount has publicly dangled a higher $30-per-share offer, but crucially has not raised that figure in its amended proposal, CNN reported.