Paramount Sweetens Warner Bros Bid With Cash Incentives and Break-Up Fee Coverage

NEW YORK — Feb 10 (GeokHub) - Paramount Skydance has revised its takeover proposal for Warner Bros Discovery, offering additional cash incentives to shareholders and agreeing to cover significant termination costs tied to a rival deal, as competition intensifies for control of one of Hollywood’s most valuable media portfolios.

While Paramount did not increase its headline offer price, the revised proposal adds financial protections designed to reduce risk for Warner Bros shareholders if the transaction is delayed or derailed.

Quarterly Cash Incentives Added

Paramount said it would pay Warner Bros shareholders a quarterly “ticking fee” of 25 cents per share for every quarter after the end of 2026 that the deal fails to close. The payments would amount to roughly $650 million in cash per quarter and would continue until the transaction is completed.

The base offer remains unchanged at $30 per share, valuing the deal at about $108 billion including debt.

Netflix Break-Up Fee Covered

In a further attempt to strengthen its bid, Paramount said it would fund the estimated $2.8 billion termination fee Warner Bros would owe Netflix if Warner Bros abandons its existing agreement with the streaming giant.

Netflix and Paramount are both pursuing Warner Bros for its film and television studios, extensive content library, and globally recognized franchises, including major fantasy, superhero, and legacy television brands.

Regulatory Confidence Signaled

Analysts said the revised offer suggests Paramount believes the competing Netflix transaction could face tougher regulatory scrutiny, while Paramount sees a clearer path to approval.

However, some analysts cautioned that the added incentives may still fall short of persuading Warner Bros investors without a higher price.

Warner Bros said its board will review the revised proposal but has not changed its recommendation supporting the Netflix deal.

Additional Deal Protections

Paramount also offered to backstop a planned Warner Bros debt exchange, covering up to $1.5 billion in potential bondholder fees without reducing other protections tied to the transaction.

The company said it has completed key regulatory filing steps in the United States and secured foreign-investment approval in Germany, while continuing discussions with regulators in the U.S., Europe, and the UK.

Paramount said the offer is backed by billions of dollars in financing, including expanded personal guarantees from its controlling shareholder and debt commitments from major financial institutions.

Concerns Over Spinoff Structure

Paramount again raised concerns about the structure of the Netflix proposal, arguing that Warner Bros shareholders would face uncertainty because a significant portion of the deal’s value depends on the future performance of a separately traded cable-network spinoff.

Paramount said it remains open to negotiating additional safeguards to address risks tied to declining linear television revenues.