Leisure, enterprise and compliance lawyer Seth Berenzweig joins Mornings with Maria to weigh in on Paramount’s bid for Warner Bros. Discovery as Netflix faces a possible class motion lawsuit over the merger.
Paramount, a Skydance Company, and Netflix each wish to buy Warner Bros. Discovery however would face related antitrust points and may need to change plans to fulfill regulators, in keeping with a contest regulation guru.
Warner Bros. Discovery (WBD) agreed to promote its movie and tv studios and streaming platform, HBO Max, to Netflix in a cash-and-stock deal valued at $27.75 per share. However then Paramount introduced Monday an all-cash tender provide to accumulate WBD for $30.00 per share in money, with the corporate suggesting it’s a “superior” provide.
Scott Wagner, co-head of the antitrust apply at Bilzin Sumberg, repeatedly guides shoppers by means of regulatory investigations performed by the Division of Justice and different authorities companies. He stated each corporations face vital challenges.
TRUMP SAYS ‘ANY DEAL’ TO BUY WARNER BROS SHOULD INCLUDE CNN
Paramount, a Skydance Company, and Netflix each wish to buy Warner Bros. Discovery. (Anna Barclay/Getty Photographs / Getty Photographs)
“I believe even with Paramount’s share of the streaming market — although it is lower than Netflix — I believe that the issues can be very related simply on the streaming entrance, whether or not it is Netflix or Paramount,” Wagner advised Fox Information Digital.
“Yeah, Netflix has an even bigger market share. It might be much less of an issue with Paramount,” he continued. “However I nonetheless assume with Paramount’s market share, it is a sufficiently big market share that the mixed firm, it might nonetheless be checked out, you recognize, with a really shut eye.”
One other issue is that Paramount’s proposed transaction is for the whole thing of WBD — together with its International Networks section that features CNN and different cable property — whereas Netflix is searching for to accumulate solely the studio and streaming divisions, abandoning struggling cable holdings similar to CNN.
Paramount controlling each CBS Information and CNN would give the corporate a robust share of conventional media, although Wagner stated courts might also weigh newer shops similar to X, Substack and podcasts when defining the general market.
Whichever firm lands Warner Bros. Discovery will face antitrust considerations. (Aleksander Kalka/NurPhoto through Getty Photographs / Getty Photographs)
“From a technical antitrust perspective, the information aspect of issues will most likely be much less of a priority than the streaming aspect,” Wagner stated.
“You might actually make an argument that the related market is the legacy media,” he continued. “However I believe the higher argument might be that the market is broader than simply the legacy media.”
In the meantime, President Donald Trump insisted Wednesday that CNN be a part of any sale.
“I believe the folks that have run CNN for the final lengthy time period are a shame,” Trump advised reporters on the White Home. “I believe it is crucial that CNN be bought since you actually would not wish to put folks, simply go away these folks with some cash, good cash at CNN in order that, you recognize, they will spend much more cash spreading poison, as a result of it is lies. It is a shame. So, I would not wish to see the identical firm find yourself with CNN.”
PARAMOUNT LAUNCHES HOSTILE TAKEOVER BID OF WARNER BROS DISCOVERY, SAYS OFFER IS ‘SUPERIOR’ TO NETFLIX DEAL
Warner Bros. Discovery CEO David Zaslav. (Michael M. Santiago/Getty Photographs / Getty Photographs)
Netflix hasn’t indicated it desires something to do with the struggling community, however Wagner believes that would change in the event that they wish to efficiently purchase WBD.
“If I have been advising Netflix, my recommendation to them can be that you just wish to do no matter you may to get the DOJ to approve this deal,” Wagner stated.
“I am not gonna opine on what sort of affect the president’s off-the-cuff feedback in a press convention have on the DOJ,” he continued. “But when you recognize taking up CNN is one thing that it wanted to do to get the deal accomplished, they may do it.”
Wagner urged Netflix might even embody CNN within the acquisition to fulfill regulators after which promote it as soon as the deal is authorised.
“That’s actually a risk,” he stated.
Panelists Ross Gerber and Laura Martin weigh in on the bidding conflict over Warner Bros. Discovery between Netflix and Paramount Skydance on The Claman Countdown.
Both method, Wagner stated the saga isn’t going to be determined anytime quickly.
“A merger like this could typically take wherever from a 12 months to 2 years to get authorised. After which there’s typically form of a interval after the approval — assuming it was authorised — there’s typically a interval after the approval to consummate the deal,” he stated.
“It is not simply the U.S. that’ll be taking a look at this. The EU and different jurisdictions can even be trying on the acquisition,” he continued. “It is also potential that you recognize an enforcer in one other jurisdiction will likely be searching for some type of change to the deal or some type of spinoff that the U.S. would not ask for.”
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Fox Information Digital’s Joseph A. Wulfsohn contributed to this report.
