The outcome of the sale of Warner Bros. Discovery remains uncertain, with one of the company’s activist investors making its presence known this week. Ancora Holdings Group, which owns $200 million in WBD shares, released a presentation on Wednesday to convince the company’s Board of Directors to reconsider the current Paramount proposal over the Netflix offer that it has already accepted.
Its two primary arguments are that the Netflix deal is at a greater risk of being blocked by regulators and that Netflix has set an unreasonably low valuation for WBD’s cable assets. The investor presentation concludes by stating that if the board does not take another look at Paramount’s offer, it will withhold its support for an upcoming shareholder vote on whether to accept the Netflix bid.
The day before Ancora released its presentation, Paramount had just sweetened its offer. While the topline $30 per share bid did not change, Paramount did introduce a ratcheting 25-cent per share increase in its bid for every quarter after December 31st, 2026, if the deal has not yet closed. This gesture was meant to show confidence that regulators would approve a Paramount acquisition quickly, unlike the Netflix alternative.
Paramount also offered to pay the $2.8 billion breakup fee that Netflix would be owed if Warner Bros. winds up choosingthe Paramount offer over Netflix. Together with the widespread sentiment in the entertainment industry that a Netflix takeover of Warner Bros. would be a net negative, the fate of WBD is far from decided.
