Warner Bros. Discovery deems Paramount's takeover bid superior to Netflix deal

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NEW YORK (AP) — Warner Bros. Discovery has determined that Paramount’s latest takeover offer is superior to the streaming and studio agreement it struck with Netflix, marking a stark shift in momentum in the fight for the storied Hollywood giant.

The owner of HBO Max, DC Studios and popular titles like “Harry Potter” had backed Netflix’s proposal for months. But after Skydance-owned Paramount upped its rival bid for the entire company to $31 per share, in addition to other revisions, Warner’s board on Thursday said that the offer “constitutes a ‘company superior proposal.’”

That could mean the start of a fresh bidding war over Warner. Netflix now has four business days to try and match Paramount’s proposal to further revise its offer — which currently stands at $27.75 per share for Warner’s studio and streaming business.

Warner on Thursday maintained that Netflix's bid remains on the table. And despite Thursday's decision, the board noted that it “has not withdrawn or modified" its previous recommendation in favor of that transaction.

Netflix did not immediately respond to a request for comment.

Meanwhile, Paramount CEO David Ellison applauded the news — noting in a statement that the company was “pleased WBD’s Board has unanimously affirmed the superior value of our offer.”

The fight for Warner is complicated because Netflix and Paramount want different things. Unlike the streaming giant, Paramount wants all of Warner’s operations, including networks like CNN and Discovery.

The companies have spent the last couple of months in a heated, public back and forth over who has a stronger deal. And Thursday's announcement arrived shortly after Paramount upped the ante on its offer.

Beyond increasing its proposed purchase price for Warner, the company also agreed to a regulatory termination fee of $7 billion. And Paramount pledged to move up a previously-promised “ticking fee.” The company had said it would pay 25 cents per share for every quarter the deal drags on past the end of the year. Now it’s agreed to pay that amount if the deal doesn’t go through by the end of September, Warner said.