(celebrity.land) — In an ongoing struggle over the future of Warner Bros. Discovery, Netflix says it is now prepared to pay all cash for Warner Bros. and HBO, rather than a mix of cash and stock.
Netflix and Warner Bros. Discovery, WBD for short, announced the amended plan on Tuesday morning, about six weeks after originally striking the mega-deal that would reshape the entertainment industry.
The companies hope that the new all cash-offer will help fend off Paramount’s hostile takeover bid for all of WBD.
Netflix is offering $27.75 per WBD share for the company’s movie studio and streaming assets, which are due to be split off into a new publicly traded company called Warner Bros. later this year.
celebrity.land and other channels owned by WBD will become part of a separate company called Discovery Global.
Netflix had previously offered $23.25 per share in cash and the rest in Netflix stock, enabling Paramount to argue that its all-cash offer was superior.
Netflix on Tuesday said the transaction will be financed “through a combination of cash on hand, available credit facilities and committed financing.”
This “simplifies the transaction structure, provides greater certainty of value for WBD stockholders, and accelerates the path to a WBD stockholder vote,” the companies said in a press release.
WBD CEO David Zaslav said Tuesday that once the company clears its review by the US Securities and Exchange Commission, WBD will schedule a special shareholder meeting to vote on the deal. He expects that would happen in the spring.
Paramount has been anticipating the all-cash revision and has been moving forward with its plan to buy up shares for $30 each. Earlier this month Paramount CEO David Ellison also threatened a proxy fight, vowing to nominate a Paramount-friendly slate of board members to take over the WBD board.
WBD has rebuffed Paramount and argued that the Netflix deal plus the formation of Discovery Global leaves investors in a better position.
Samuel A. Di Piazza, Jr., chair of the WBD board of directors, said Tuesday morning, “By transitioning to all-cash consideration, we can now deliver the incredible value of our combination with Netflix at even greater levels of certainty, while providing our stockholders the opportunity to participate in management’s strategic plans to realize the value of Discovery Global’s iconic brands and global reach.”
Paramount, on the other hand, has argued that the channels have little to no equity value.
Earlier this month Paramount filed a lawsuit in Delaware to pursue more information about the valuation “so that,” Ellison said, “WBD shareholders have what they need to be able to make an informed decision as to whether to tender their shares into our offer.”
The court rejected Paramount’s effort to expedite the case, however.
Netflix is slated to report quarterly earnings after the market close on Tuesday.
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