Warner Bros. Discovery has accepted a new all-cash offer from Netflix on Tuesday, agreeing to sell its studios and streaming business for $27.75 a share as the companies move toward a shareholder vote in the face of a hostile bid from Paramount.
The revised agreement replaces Netflix’s earlier cash-and-stock offer and is expected to speed the deal toward a shareholder vote by April while blunting Paramount Skydance’s argument that its rival $77.9 billion bid is the only clean, all-cash option on the table.
The revised $72 billion deal, first reported by the Wall Street Journal, also prompted WBD to release new financial disclosures on its soon-to-be spun-off cable networks, offering investors a clearer look at the business they would retain if the Netflix transaction closes.
Paramount has argued that the lack of detailed financial disclosure around the cable spinoff and the structure of the Netflix deal was a central reason it escalated its hostile bid, saying shareholders were being asked to choose between competing offers without basic information.
The company has repeatedly pressed WBD to release projections and valuation analyses for the cable business, calling the disclosures a major bone of contention and citing their absence as grounds for both its proxy fight and its lawsuit in Delaware.
Warner said on Tuesday that the disclosures include updated projections for the cable business, which will be spun off into a separate company called Discovery Global.
The cable division shows declining revenue and earnings over the next several years even as the unit continues to generate better-than-expected cash flow, according to WBD.
Netflix co-CEO Greg Peters said in a statement that the revised deal “demonstrates our commitment to the transaction” and accelerates the process for WBD shareholders.
