Netflix's Warner Bros Takeover Bid vs Paramount Rival Offer

The boss of Netflix has told the BBC its takeover bid for Warner Bros is better than a rival one from Paramount because it would expand the business and the industry. Co-chief executive Ted Sarandos told the Today programme Netflix's bid was focused on "growth", adding: "We're buying a movie studio and a distribution entity that we don't currently have - we'll be adding to the market." Last December, Warner Bros agreed to a takeover offer from Netflix for some of its assets, but Paramount has made a rival offer.

Sarandos also batted away threats from President Trump who said that if Netflix did not fire Democratic board member Susan Rice, the streaming giant would "face the consequences". Sarandos said: "This is a business deal, it's not a political deal. He [Trump] likes to do a lot of things on social media," he added.

Last week, Warner Bros gave Paramount until the end of Monday to submit a "best and final" offer ahead of the shareholder vote on the Netflix deal next month. Netflix has offered $27.75 a share, or $82.7bn (£61.2bn) in total, for Warner Bros' studio and streaming networks - including brands such as Warner Bros, New Line Cinema, and HBO Max - leaving the rest of the firm to be spun off as an independent company. However, Paramount's $30 a share, or $108.4bn, bid is for the entire company, including the firm's traditional pay-TV networks, which are seen as a declining business.

Sarandos said Paramount was "continuing to try to disrupt" Netflix's deal with Warner Bros. He said Netflix's bid was better than Paramount's as it would be "buying assets we don't currently have". "This industry would be much smaller under that [Paramount] ownership than it would be under Netflix," he added. "Our deal is growth. We've been growing and growing and growing this business since we started," he said.

He used Netflix's investment in the UK as an example of its growth strategy, saying it had created 50,000 jobs and spent "$6bn in the UK on original programming" since 2020. Sarandos said Paramount "has committed that they're going to cut $6bn out of the business right away", and then would "need to cut an additional $16bn". "There's five major studios left in Hollywood. If the Paramount deal were to go through, it would be four, because basically they're taking two studios and collapsing them in to one," he said.

It has previously said its deal gives shareholders more certainty than Netflix's plan. It has also offered to pay the $2.8bn break-up fee Warner Bros has agreed to pay Netflix if that deal falls through. Last week, Paramount said it would "continue to advance our tender offer" and maintain its "opposition to the inferior Netflix merger". When asked if he would make a higher offer if Paramount dialled up its bid, Sarandos said he didn't "want to do hypotheticals" - but went on to say the Netflix deal was "a spectacular opportunity at a price".

Sarandos also rebuffed criticism from cinematic powerhouse James Cameron, who directed the Avatar films as well as blockbuster Titanic starring Leonardo DiCaprio. Sarandos called Cameron "disingenuous" for writing to US competition regulators saying that it would be "disastrous" for the cinema business if the Netflix deal went ahead. He said: "An average Netflix member watches seven movies a month. An average person in the US goes to the cinema twice a year." He added that he didn't see Netflix as a direct competitor to the big-screen because when people watch a great film at the cinema, the next thing they want to do when they come home is watch more films.