David Ellison is not abandoning his quest to build a new Hollywood juggernaut.
The Ellison-controlled Paramount disclosed Thursday in a regulatory filing that it was extending the deadline of its tender offer for Warner Bros. Discovery shares. The firm had previously asked Warner stockholders to sell Paramount their shares for $30 a piece by Wednesday.
The new deadline is Feb. 20.
Paramount also filed proxy materials with the Securities & Exchange Commission, saying it would challenge the alternative bid for Netflix at an upcoming special meeting of Warner shareholders to vote on the company’s sale. Warner’s board has not yet set the meeting date but has suggested the pivotal vote could occur by April — pushing the pitched battle for the company into spring.
Warner’s board unanimously agreed on Dec. 4 to sell much of the company to Netflix for $27.75 a share. Before that can happen, Warner must spin off CNN and other basic cable channels into a new publicly traded company called Discovery Global.
The multi-step process is giving Paramount a wide window to make its case to Warner shareholders.
“The consideration payable to WBD shareholders in the Netflix transaction falls well short of Paramount’s $30 per share all-cash offer,” Paramount said in Thursday’s announcement.
Billionaire Larry Ellison and his family took control of Paramount in August determined to become major players in Hollywood.
The following month, the Ellisons began their audacious pursuit of Warner Bros. Discovery. Their goal is to combine two century-old film studios and vibrant television production capabilities and marry such popular TV networks as HBO, CBS, Comedy Central, HGTV and TBS.
Paramount launched its hostile takeover last month after failing to gain traction with Warner’s board, which remains steadfast in its support for Netflix’s $72-billion proposed purchase of HBO, HBO Max and the Warner Bros. film and television studios.
Earlier this week, Netflix converted its $27.75 a share bid to an all-cash offer in hopes of defusing some of Paramount’s criticisms of its deal.
Paramount has been stressing that Netflix’s regulatory path is uncertain. Both sides plan to make their case to European regulators.
Unlike Netflix, Paramount wants to buy all of Warner Bros. Discovery, including CNN and other basic cable channels. The value of the proposed company, Discovery Global, factors into the ultimate value that shareholders will receive if the Netflix bid prevails.
The cable channel spinoff is expected to be completed this summer, but the value of the channels is in doubt, giving Paramount ammunition to claim that its $30-a-share tender offer for the entire company was more lucrative than Netflix’s $27.75-a-share offer for Warner’s studios and HBO.
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