Warner Bros. Discovery rejects Paramount’s hostile offer, calls calls ‘fake’

Warner Bros.’s board of directors rejected the deal. Discovery ( WBD ) has bid on a $108 billion hostile takeover of David Ellison’s Paramount Skydance, calling the offer “fictitious” and saying Paramount misled shareholders about its financing.

Saying it wanted to honor its initial agreement to sell to Netflix, WBD’s board of directors wrote in a letter to shareholders that Paramount “consistently misled WBD shareholders that its proposed transaction had the full support of the Ellison family.”

“That did not happen and never happened,” the letter said.

WBD’s board said Paramount’s tender offer was still “inferior to the Netflix merger” and noted that Netflix’s $27.75-per-share offer for Warner Bros.’s Hollywood studios and streaming business “is a binding agreement with enforceable commitments, without the need for any equity financing and aggressive debt obligations.”

Netflix welcomed the move. “Warner Bros. Discovery’s board of directors has confirmed that the Netflix merger agreement is superior and that our acquisition is in the best interests of shareholders,” Netflix co-CEO Ted Sarandos said in a statement.

Paramount and Ellison’s backers, including his father, tech billionaire Larry Ellison, will review WBD’s rejection and decide whether to raise their offer, Variety reports.