When industries are going through disruptions, some will see the industry as half empty and others will see it as half full. The half full means companies will consolidate in order to grow differently. One of the industries that is changing is the movie industry. For generations it meant going to the movies and with the internet it became streaming. This means all kinds of things although people still enjoy and want movies to tell stories.

In an article by Michelle Chapman of the Associated Press, Paramount Skydance launched a hostile takeover offer for Warner Brothers Discovery of rival bidder Netflix.

Warner Bros Discovery is the studio behind HBO, CNN, DC Studios and much more. Recently the Board of Directors of Warner Bros Discovery accepted Netflix’s $72 billion purchase.

Paramount Skydance offered $108.4 billion and willing to buy all of Warner’s business including the cable business that Netflix does not want.

The deal includes more cash than Netflix – $18 billion. and Paramount Skydance noted it is more likely to pass antitrust scrutiny from the Trump administration.

Netflix offered cash and stock valued at $27.75 a share or a total of $82.7 billion

Paramount Skydance has offered $30 a share and has gone to the Middle East for partial funding tapping into Saudi Arabia’s Public Investment Fund, Qatar Investment Authority, Affinity Partners, the investment firm run by Jared Kushner, and the largest owner of Oracle Software – Larry Ellison who is the father of Paramount SkyDance CEO David Ellison.

Linking to dividend paying stocks, when mergers are announced they are often backed by the stock price of a company, if people do not want to keep the shares they can sell and some do because they own a different company in the same business, they see opportunities elsewhere, mergers take time before the results are seen, so you can watch from the sidelines and then possibly buy down in 6 months to a year at a lower price or you will need to do portfolio management and that is a good thing to have to do.

There are more questions than answers, till the next time – to raising questions.