Exclusive | Paramount Skydance has a ‘plan B’ if Netflix wins auction

Exclusive | Paramount Skydance has a ‘plan B’ if Netflix wins auction

If Warner Bros. Discovery is leaning towards Netflix’s provide in the high stakes race for the company’s property, rival bidder Paramount Skydance has a “Plan B” to win the auction, On The Money has realized.

Netflix has made a majority money provide to buy the Warner Bros. studio and HBO Max while Paramount Skydance has made an all-cash bid for the entire company including cable channels TGB and HBO, the sources said. WBD might decide a profitable bidder as early as this week, people near the course of inform The Post. 

A source near WBD said the media big believes this is now a “horse race” between Paramount Skydance and Netflix whose final result is a “toss up,” giving it “50 50” odds. 

Paramount Skydance CEO David Ellison (above) and father Larry are growing a game plan that includes going over the head of the WBD board and immediately telling shareholders, just like a hostile bid for the company. Evan Agostini/Invision/AP

Still, hypothesis is rising that WBD has come to want Netflix’s bid. Insiders notice that Netflix CEO Ted Sarandos and WBD chief David Zaslav are said to be shut. Netflix is also seen by the WBD board as a “better steward” of WBD’s property versus David and Larry Ellison, who’re relative newcomers to major media, according to a source.

But if the board chooses Netflix, the Ellisons are growing a game plan that includes going over the head of the board and immediately telling Warner’s shareholders, just like a hostile bid for the company, according to people with direct information of the matter. Their pitch: the Netflix deal is doomed to fail, going through rejection by President Trump’s antitrust cops at the Department of Justice and, if litigated, a loss in federal courts. 

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Likewise, the Ellisons will argue that theirs is the only deal that will glide by means of the regulatory course of, and that shareholders will probably be paid instantly for the whole company. Even if Netflix pitches a majority money bid of near $30 a share as they think — a worth nicely above the Ellisons’ current provide of round $25 — shareholders must haircut the provide given the time worth of cash; during a authorized course of that might last more than two years, its property will deteriorate as the destiny of the company stays in limbo. 

“Based on my conversations, the Ellisons aren’t going away quietly and are making contingency plans if they lose,” said one senior media government who has had conversations with people at Paramount Skydance.

Insiders notice that Netflix CEO Ted Sarandos (above) and WBD chief David Zaslav are said to be shut. REUTERS

A spokeswoman for Paramount Skydance had no remark. A WBD rep also declined remark as did Netflix.

As The Post reported, senior White House officers not too long ago met to debate considerations about the Netflix combo. Combining two related, so-called “horizontal” property, Netflix’s No.1 streaming service with Warner’s No 3 service, HBO Max, virtually always results in an adversarial final result on antitrust grounds.

Also mentioned: A Netflix-WBD combo would face critical opposition from European regulators, a authorities official at the confab said.

A Netflix-WBD combo would face critical opposition from European regulators. WBD CEO David Zaslav, above. Getty Images

Paramount Skydance, meanwhile, will argue that its only overlap is the combining of Warner’s studio with Paramount’s, which given the proliferation of manufacturing venues, doesn’t meet monopoly standing. Trump regulatory officers are less involved about the antitrust implications of mixing studios as Paramount Skydance is planning, in addition to another bid by media big Comcast, sources with direct information of the matter say.

People acquainted with the Ellisons’ considering say they’re also ready to attend for the inevitable loss in court docket, swooping in at some later date with a suggestion that isn’t topic to a bidding warfare. 

Paramount Skydance, meanwhile, will argue that its only overlap is the combining of Warner’s studio with Paramount’s, which given the proliferation of manufacturing venues, doesn’t meet monopoly standing. REUTERS

It’s unclear the place Comcast, the media conglomerate headed by Brian Roberts, stands in the bidding. Like Netflix and Paramount Skydance, it has submitted a second round provide, though its steadiness sheet is such that it should borrow to maintain tempo with other suitors who’re providing $25 or more for WBD, a deal worth that might attain $70 billion.

Roberts also has a strained relationship with Trump who has made no secret of his disdain for him and Comcast’s MAGA-hating MSNBC subsidiary. Even bankers working for Comcast concede Roberts is the darkish horse in the buyout drama.

A Comcast spokesman had no remark.

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