Paramount Skydance has called out Warner Bros. Discovery (WBD) for “favouring a single bidder” and questioned the fairness of its transaction process as the bidding war with Netflix and Comcast intensifies.
In a letter from its attorneys at Quinn Emanuel, obtained by CNBC, Paramount Skydance said: “It has become increasingly clear, through media reporting and otherwise, that WBD appears to have abandoned the semblance and reality of a fair transaction process, thereby abdicating its duties to stockholders, and embarked on a myopic process with a predetermined outcome that favours a single bidder.
“We specifically request and expect this letter will be shared and discussed with the full board of directors of WBD.”
The letter also highlighted it’s cause for concern following reports by several U.S. media outlets of “the enthusiasm by WBD management for a transaction with Netflix” that called a deal between WBD and Netflix a “slam dunk” while also referring to Paramount’s bid in a negative light.
Paramount Skydance’s letter said: “Additional reporting since the submission of revised bids on December 1 has indicated that WBD’s ‘board has really warmed to’ a transaction with Netflix due to the “chemistry between” WBD and Netflix management teams.
The entertainment company added that they want to “engage in a productive discussion” with WBD “around any actual or perceived issues that it may reflect.”
According to the publication, Netflix was the leading bidder based on how WBD is valuing the offers while Comcast remain disciplined in the company’s offer to not anger shareholders by taking on additional debt and risking its balance sheet.
WBD confirmed with CNBC that it recieved the letter from Paramount Skydance’s laywers and added: “Please be assured that the WBD Board attends to its fiduciary obligations with the utmost care, and that they have fully and robustly complied with them and will continue to do so.”
The publication noted that WBD has requested third-round bids from the bidders due Thursday with the winner announced as early as next week.
Paramount Skydance is looking to buy all of WBD, while Netflix and Comcast want to buy Warner Bros. studios and streaming business – not WBD’s linear TV assets.
See also: Paramount Skydance bid for Warner Bros. Discovery faces off against Netflix and Comcast