For a while, the silence from Warner Bros. Discovery CEO David Zaslav was golden for shareholders. Now, it just seems like silence \u2014 and it\u2019s angering some of those big shareholders.<\/p>\n
For weeks, Zaslav and his board have been steadfastly rejecting Paramount\u2019s repeated, $108 billion overtures for all of WBD. They\u2019ve argued that Netflix\u2019s mixed $27.75-per-share cash-and-stock bid, combined with a spinoff of Warners\u2019 linear networks (CNN, HGTV, and a tiny streamer) will give shareholders more value than Paramount\u2019s $30-per-share bid. That argument has been ill-received by shareholders, who generally prefer money in hand to a gamble on a mix of stock, cash, and shares in a low-multiple spinoff.<\/p>\n
Top WBD executives have privately said they are willing to open a dialogue with Paramount again if the company increases its bid, according to people familiar with their discussions. Paramount\u2019s leaders feel like WBD has adopted an insulting posture towards their bids, despite repeated efforts to improve them, and also see any increase in price as bidding against themselves, according to other people familiar with the matter. There have been no substantive negotiations between WBD and Paramount since WBD rejected Paramount\u2019s bid more than a month ago, according to people close to both companies. Instead, they\u2019ve traded tit-for-tat messages in public letters to shareholders.<\/p>\n
The standoff is starting to infuriate big shareholders, some of whom told Semafor they saw no other explanation for WBD\u2019s refusal to negotiate with Paramount than what they believe is an inexplicable personal animus towards Paramount CEO David Ellison. (WBD\u2019s chair has said they are \u201cvery open\u201d to a Paramount deal.) Pentwater Capital, a large WBD shareholder and one of the top merger-arbitrage shops, publicly excoriated WBD\u2019s refusal to play ball with Paramount on CNBC Wednesday and said the firm would block the deal with Netflix.<\/p>\n