Warner Bros. will reopen takeover talks with Paramount Skydance after receiving a seven-day waiver to do so from its preferred bidder, Netflix.
Warner Bros. said in a regulatory filing Tuesday that the waiver will allow it to discuss unresolved “deficiencies” in Paramount’s previous offers.
Warner Bros. Discovery now has until Monday to negotiate a possible transaction with Paramount Skydance.
“While we are confident that our transaction provides superior value and certainty, we recognize the ongoing distraction for WBD stockholders and the broader entertainment industry caused by PSKY’s antics,” Netflix said in a statement. “Accordingly, we granted WBD a narrow seven-day waiver of certain obligations under our merger agreement to allow them to engage with PSKY to fully and finally resolve this matter.”
Warner Bros. said Tuesday that its board still recommends unanimously that shareholders vote for the Netflix buyout.
Warner’s leadership consistently has backed the offer from Netflix. In December, Netflix agreed to buy Warner’s studio and streaming business for $72 billion — now in an all-cash transaction that the companies have said will speed up the path to a shareholder vote by April. Including debt, the enterprise value of the deal is about $83 billion, or $27.75 per share.
Unlike Netflix, Paramount wants to acquire Warner’s entire company — including networks like CNN and Discovery — and went straight to shareholders with all cash, $77.9 billion offer in December.
Warner Bros. has a special meeting scheduled for Friday, March 20. The company’s stock rose more than 2% before the market open on Tuesday.
Shares of Paramount Skydance climbed nearly 3%, while Netflix’s stock rose slightly.