Warner Bros Discovery has told shareholders to reject a hostile takeover bid from rival Paramount Skydance.
It has pushed back against the approach and stressed it favours a deal from streaming giant Netflix to take control of its movie studios, cable networks and streaming service.
Bosses at Warner Bros, which makes franchises such as Harry Potter and Batman, said the proposed deal from Paramount was “inadequate” and poses a “significant risk” to shareholders.
Samuel Di Piazza Jr, chairman of the Warner Bros board of directors, said: “This offer once again fails to address key concerns that we have consistently communicated to Paramount throughout our extensive engagement and review of their six previous proposals.
“We are confident that our merger with Netflix represents superior, more certain value for our shareholders and we look forward to delivering on the compelling benefits of our combination.”
Paramount lodged a 30 US dollars (£22.50) a share bid for Warner Bros, days after the company agreed to be bought by Netflix in early December in a 72 billion dollar (£54 billion) deal.
Paramount’s offer values Warner Bros at 108.4 billion dollars (£81.3 billion) including debts, trumping Netflix’s 27.75 dollars (£20.81) per share offer, which values Warner Bros at 72 billion dollars or 82.7 billion dollars (£62 billion) including debts.
Netflix agreed to buy the Warner Bros Discovery film and TV studios business whereas Paramount has bid for the whole of Warner Bros.
Earlier on Wednesday, Affinity Partners, the private equity firm owned by US President Donald Trump’s son-in-law Jared Kushner, pulled its backing from Paramount’s bid.
Mr Trump previously warned the Netflix takeover of Warner Bros “could be a problem” because of its combined market share, confirming he would be involved in the decision about whether the US federal government should approve the deal.
Paramount said in its appeal to win over Warner Bros shareholders that its offer would be more likely to pass regulatory scrutiny.
Mr Kushner’s decision to pull his firm’s financial backing is seen as taking away a possible advantage for Paramount to secure Mr Trump’s approval.
Paramount’s bid still has the financial backing of wealth funds run by three governments in the Persian Gulf, widely reported as Saudi Arabia, Abu Dhabi and Qatar.
Paramount earlier revealed it had made six takeover approaches to Warner Bros over 12 weeks, but claimed Warner Bros “never engaged meaningfully”.
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