Streaming giant Netflix’s (NFLX) co-CEO Greg Peters remains confident in the streaming giant’s $82.7 billion offer for Warner Bros. Discovery (WBD) amid mounting investor concerns about the deal. This comes even as rival Paramount Skydance (PSKY) has turned to a proxy fight to back its hostile $108.4 billion offer.
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On Friday, Peters told the Financial Times that Netflix is poised to secure the support of Warner Bros. Discovery for its offer. He added that Paramount’s rival offer “doesn’t pass the sniff test.”
Netflix Stresses Sparse Support for Paramount
The Netflix executives also point to the fact that Paramount has only been able to secure a “very small” number of WBD shares to back its offer. According to Warner Bros., just about 7% of its shareholders have agreed to sell their shares in support of Paramount’s offer.
While Netflix is seeking to acquire only Warner Bros.’ movie and TV studios as well as the streaming platform HBO Max, Paramount’s offer covers the entirety of the century-old entertainment company’s assets.
Netflix and Paramount Sharpen Tactics
Peters’ comment comes as both rivals have made recent moves to secure the highly watched acquisition. This week, Paramount — which recently obtained a $40 billion equity assurance from Oracle (ORCL) founder Larry Ellison to back its $32-per-share deal — extended the deadline for Warner Bros. to consider its offer from January 21 to February 20.
The California-based company, which is led by David Ellison, Larry’s son, is also reportedly prepared to raise its offer to a maximum of $33 per share for all of Warner Bros., if necessary. On its part, Netflix this week also switched its offer to an all-cash deal in an effort to make its deal more convincing.
So far, Netflix appears to be winning the race, as the Warner Bros. board has formally rejected Paramount’s offer twice. In addition, Warner Bros. has rescheduled the shareholder vote on the proposed Netflix deal to February instead of May in a bid to ratchet up pressure on Paramount.
Is Netflix Stock a Good Buy Right Now?
On Wall Street, Netflix’s shares remain a Moderate Buy based on analysts’ consensus. This breaks down to 26 Buys, 10 Holds, and one Sell issued by 37 analysts over the past three months.
However, the average NFLX price target of $116.42 implies more than 39% growth potential.
