"The board of Warner Bros Discovery (WBD) has unanimously turned down Paramount Skydance's latest attempt to acquire the studio, saying its revised $108.4bn hostile bid amounted to a risky leveraged buyout that investors should reject. In a letter to shareholders on Wednesday, the WBD board said Paramount's offer hinges on an extraordinary amount of debt financing that heightens the risk of closing. It reaffirmed its commitment to streaming giant Netflix's $82.7bn deal for the film and television studio and other assets."
"Paramount, which has a market value of about $14bn, proposed to use $40bn in equity, which would be personally guaranteed by Oracle's billionaire co-founder Larry Ellison, whose son David is Paramount's CEO, and $54bn in debt to finance the deal. Its financing plan would further weaken its credit rating, which S&P Global already rates at junk levels, and strain its cash flow heightening the risk that the dea"
Warner Bros Discovery's board unanimously rejected Paramount Skydance's revised $108.4bn hostile bid, calling it a risky leveraged buyout that investors should reject. The board stated the offer depends on an extraordinary amount of debt financing that increases the risk of closing. The board reaffirmed commitment to Netflix's $82.7bn deal for the film and television studio and related assets. Some investors pushed back, with Pentwater Capital Management's CEO Matthew Halbower calling Paramount's proposal economically superior. Paramount planned to use $40bn in equity guaranteed by Larry Ellison and $54bn in debt, which would strain credit and cash flow.
Read at www.aljazeera.com
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