As the bidding war over Warner Bros. Discovery is heating up, Paramount Skydance is accusing the company of orchestrating an unfair bidding process that favors Netflix.
The company accused the sales process of being “tainted by management conflicts” in a letter to CEO David Zaslav. CNBC published the letter in full. Specifically, it claims that certain members of WBD’s management have “personal interests” in roles and compensation that would happen after the transaction and that there is “director bias” to people whose interests might not align with stockholders.
“It has become increasingly clear, through media reporting and otherwise, that WBD appears to have abandoned the semblance and reality of a fair transaction process,” the letter reads, accusing the bidding process of having a “predetermined outcome that favors a single bidder.”
To back its claims, the letter pointed to media reports in the U.S. that seemed to favor Netflix as Warner Bros. Discovery’s preferred bidder as well as a report from a German newspaper about a meeting with WBD President of International Gerhard Zeiler, a direct report to Zaslav and E.U. Commission Vice President Henna Virkkunen it dubs as “active sabotage.” During that meeting, concerns were raised that if the Ellison family acquired WBD, it could lead to “excessive media concentration.” Because of that, the E.U. commission would consider intervening if there was a merger between Paramount and WBD. Though it’s commonly thought that Paramount will have an easier time buying WBD under the Trump administration, concerns from international parties have been cited as a major potential roadblock for the company.
The letter then states its purpose is to inquire whether the media’s Netflix-leaning reports are “accurate” but then goes on to say they “echo similar indications” Paramount has been hearing throughout the bidding process.
More to come …
