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Paramount launches a hostile takeover bid for Warner Bros. Discovery

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Paramount has gone straight to Warner Bros Discovery’s shareholders with an all-cash offer in an extraordinary endeavour to gain control of Hollywood’s most sought-after prize – a bid that Netflix beat last week.

Paramount was widely expected to be the frontrunner for Warner Bros. But WBD opted instead for Netflix, which it said offered a more lucrative deal. The proposed marriage with Netflix caught Hollywood insiders by surprise – including Paramount CEO David Ellison, who still contends that his deal was the better offer.

“We’re sitting on Wall Street, where cash is still king,” Ellison told CNBC in an interview this week. “We are offering shareholders $17.6 billion (NZD$30.5b) more cash than the deal they currently have signed up with Netflix. And we believe when they see what is currently in our offer, then that’s what they’ll vote for.”

Paramount offered $30.90 (NZD$52) per share in an all-cash deal for the entire company, while Netflix offered $27.75 (NZD$48) for Warner Bros. and HBO – $23.25 (NZD$40) per share in cash and $4.50 (NZD$7.80) in stock.

The math is tricky, but Netflix believes the eventual spinoff of WBD’s cable assets, including CNN – which is not included in the Netflix deal – will be worth several dollars per share. In its entirety, Netflix contends that its deal will ultimately be worth more than Paramount’s offer.

Paramount, unlike Netflix, is seeking to buy WBD in its entirety. It notes its offer is worth $108.4 billion (NZD$187.8b) for all of WBD, compared to $82.7 billion for (NZD$143.3b) Netflix’s offer, which doesn’t include the value of the company’s cable channels.

In accepting Netflix’s offer last week, WBD’s board clearly decided that the deal was better. It has long been argued that the cable assets will be worth more when spun off than combined with the movie studio and HBO, unlocking significant value for shareholders.

On Monday, Paramount said WBD shareholders should decide.

“WBD shareholders deserve an opportunity to consider our superior all-cash offer for their shares in the entire company,” Ellison said in a statement. “Our public offer, which is on the same terms we provided to the Warner Bros. Discovery Board of Directors in private, provides superior value, and a more certain and quicker path to completion. We believe the WBD Board of Directors is pursuing an inferior proposal.”

WBD’s (WBD) stock surged 7 percent to nearly $28 (NZD$48.50) a share on Monday, as investors anticipated a bidding war. Netflix may come back with an even more lucrative offer to counter Paramount’s bid. Paramount (PSKY) rose 4 percent and Netflix (NFLX) fell more than 3 percent.

If WBD ultimately chooses Paramount’s offer, it would owe Netflix a $2.8 billion (NZD$4.8b) breakup fee.

Paramount appeals to shareholders

In addition to his contention that his deal offers WBD shareholders more overall value, Ellison also made the argument that Paramount’s offer stands a higher chance of regulatory approval. He noted to CNBC that Netflix’s offer would combine the No. 1 streamer with HBO Max, which is No. 3 – a potentially unappealing prospect for sceptical antitrust authorities.

Ellison touted his positive relationship with President Donald Trump (who similarly noted Sunday that he has a strong relationship with Netflix co-CEO Ted Sarandos).

“I’m incredibly grateful for the relationship that I have with the president,” Ellison told CNBC. “And I also believe he believes in competition. And when you fundamentally look at the marketplace, allowing the No. 1 streaming service to combine with the No. 3 streaming service is anticompetitive.”

Netflix has contended that its deal will pass antitrust scrutiny. It stands ready to refute Paramount’s marketplace claims by pointing to different metrics: Nielsen’s measurement of the industry shows Netflix with 8 percent of total TV usage time, slightly under Paramount’s 8.2 percent. By that measure, Netflix ranks No. 6 on the Nielsen gauge, with YouTube at No. 1 and Disney at No. 2.

Ellison said Netflix’s argument was akin to saying Coke could buy Pepsi because Budweiser sold a lot of beer – YouTube is in a different category, he argued.

He also appealed to consumers and the industry. He told CNBC on Monday the Netflix-WBD deal would spell “the death of the theatrical movie business in Hollywood.”

“It’s bad for the consumer, it’s bad for the creative community,” Ellison said. “We’re sitting here trying to save it.”

Ellison’s plans

Ellison gave a sense of his plans for the broader company, creating a “real competitor to Netflix, a real competitor to Disney.” He said Paramount’s offer would better support Hollywood’s creative community than Netflix, which he argued would create an anti-competitive behemoth.

“As someone who spent the last 15 years of my life producing movies and television shows, this is an industry that I love, this is an existential moment for our business, and we believe that what we’re offering is better for Hollywood, it’s better for customers, and it’s pro-competitive,” Ellison told CNBC.

He said buying Warner Bros. Discovery would create a healthy competitor that would make the industry stronger.

“What we are doing will create another scaled, healthy buyer for the creative community and talent, will put 30 movies a year in theaters exclusively,” Ellison said.

Ellison has appointed himself an unlikely saviour of Hollywood. It’s early days, but he has invested substantially in Paramount in his first few months on the job.

Although Ellison’s politics have been largely center-left throughout his career, he has made several overtures to Trump over the past year, sitting with the president at multiple UFC events and agreeing to the administration’s conditions to complete his Paramount acquisition in August. He also has sought to transform CBS News, paying top dollar for the right-leaning The Free Press and appointing its founder Bari Weiss as CBS’ overseer – a decision that Trump has said he approves.

Ellison said if his offer wins, Paramount would combine CBS News with CNN.

“We want to build a scaled news service that is basically fundamentally in the trust business, that is in the truth business, and that speaks to the 70 percent of Americans that are in the middle,” Ellison said.

Ellison said he’s had “great conversations” with Trump about Paramount’s plan for its proposed news business, but he added that he didn’t want to speak for Trump, whose son-in-law Jared Kushner is involved in the deal’s financing.

In addition to former Redbird, other investors include Saudi Arabia’s Public Investment Fund and Qatar and Kushner’s Affinity Partners, which has a substantial investment from the Saudi sovereign wealth fund. To avoid national security scrutiny, the foreign entities have agreed not to take any board seats or vote their equity stakes in the company if the deal were to go through, Paramount announced Monday.

Ellison also said his father, Oracle executive chairman Larry Ellison, one of the world’s richest people, is chipping in an unspecified amount of equity to produce the cash – an amount that David Ellison said was fully backstopped.

Source: CNN & RNZ

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World

Voters deliver historic rebuke to Trump as Democrats win House and Senate

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By Joseph Ax, Brad Heath and Jason Lange

Democrats seized control of both the Senate and House on Tuesday (US time), scoring sweeping victories in Republican strongholds for the first time in generations as tens of millions of voters delivered a scathing rebuke to President Donald Trump.

Voters in conservative bastions who had propelled the president to his second term in office just two years ago swung dramatically toward Democrats, fueled by deep frustration over the unpopular war with Iran, anxiety over the high cost of living and anger at Trump’s stewardship of the country.

Kansas elected its first Democratic senator since the Great Depression nearly a century ago. In South Carolina, a state that Trump carried by nearly 18 points in 2024, Democrats turned aside his hand-picked Senate candidate.

And in Texas, the biggest Republican state, Democrats ended a decades-long losing streak in seismic fashion, winning a Senate seat and ousting three-term Governor Greg Abbott.

The results will usher in a new era of divided government in Washington, following two years in which the Republican-controlled Congress rarely exercised its power to rein in Trump.

Once seated in January, Democrats are expected to use their power to investigate Trump’s administration, family and allies and demand concessions on major legislation. The Democratic Senate can block Trump’s nominees, including any US Supreme Court justices should a vacancy arise.

“There is now a generational remake of the Senate map that is going to change America,” said Chuck Schumer, the party’s Senate minority leader. “Americans voted for change, and now Democrats must deliver.”

Trump, who is barred by the US Constitution from seeking a third term, has exercised an iron grip on his party for most of the last decade. But the new balance of power in Washington may accelerate his lame-duck status, as attention turns toward the 2028 presidential race and potential successors begin competing for political influence in a post-Trump world.

Despite worries from Democrats that Trump might seek to overturn the election results, as he did in 2020, the president accepted the outcome, congratulating Democrats in an interview with Fox News. He also said he would work with Democrats on issues such as immigration, though he threatened to veto any “insane” bills they passed.

rnz

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Cold case solved: DNA links serial killer Ted Bundy to 1974 murder of Utah teen

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A Utah cold case tied to notorious serial killer Ted Bundy has been solved.

Fifty-two years to the day her body was found, detectives closed the investigation into the murder of 17-year-old Melissa Ann Smith. DNA evidence identified Bundy as the killer, investigators revealed Tuesday.

Smith’s body was found by hunters in a wooded area bordering Salt Lake and Summit counties on 27 October, 1974. The investigation into her murder has remained open since that day, until now.

A recent break in a Utah County cold case is being attributed to the resolution. Investigators say the same DNA profile used to identify Bundy as the killer of Laura Ann Aime was used to solve Smith’s murder.

Developments in that case brought the Smith investigation back to the surface and helped resolve the decades-old mystery, Summit County Sheriff Kacey Bates said.

Tuesday’s announcement was hinted at by Utah County investigators in April, when they announced the closure of the Aime cold case, which was tied to Bundy. At the time, a UCSO detective said the DNA profile used to link Bundy to the murder had been shared with other departments, with the hope that it could lead to closing more cases.

Bundy, who is confirmed to have killed and assaulted women across Washington, Oregon, Colorado, Utah and Florida between 1974 and 1978, confessed to 28 murders but is believed to be responsible for hundreds of deaths.

He was executed by electric chair in Florida in 1989.

Source: RNZ & CNN

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Netanyahu touts Trump endorsement on eve of vote, suggests they may restart war on Iran

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Israeli Prime Minister Benjamin Netanyahu boasted of his endorsement from Donald Trump on the eve of Israel’s election, suggesting the two leaders could restart their war against Iran if he wins, after Trump said they should “finish the job”.

“US President Donald Trump has come with a friendship that has never existed before between an Israeli prime minister and an American president. And it is doubtful we will ever have such a friendly president again,” Netanyahu said in a televised appearance late on Sunday night. “He has another two years, and he says he is calling on you to vote for me.”

In his own social media post on Sunday, Trump, who launched the Iran war jointly with Netanyahu in February, said: “Vote for Bibi Netanyahu for Prime Minister, we have to finish the job that we started!”

Netanyahu said Trump was willing to take action “that would finally, finally, remove the Iranian threat”, but only as long as Netanyahu himself remains in power.

“And I have already instructed the Mossad and the IDF (military) to bring down this regime, to bring down this regime because that is the only way to put an end to this threat,” Netanyahu said, referring to Israel’s main intelligence service and military.

Asked for comment on Netanyahu’s remarks, White House Deputy Press Secretary Anna Kelly said: “As President Trump stated, Iran is in very bad condition, both economically and militarily, and the blockade will remain in full force and effect, with oil flowing in record numbers of barrels through the Hormuz Strait.”

“The United States will not be attacking Iran at any time prior to the midterm elections,” Kelly added via email, referring to the November 3 vote in the US.

Netanyahu’s leading opponent, centrist former military Chief of Staff Gadi Eisenkot, posted his own comments on social media, praising Trump as “a true friend of Israel”.

“I value his efforts and his commitment to Israel’s security, and I am confident that he will work in full cooperation with any leader chosen by the people.”

Former Israeli Defence Minister Benny Gantz (2nd-R) and former Israeli army chief of staff Gadi Eisenkot (R), both members of the current Israeli five-person war cabinet led by Prime Minister Benjamin Netanyahu, meet with the visiting US Secretary of State in Tel Aviv on February 8, 2024. (Photo by Mark Schiefelbein / POOL / AFP)
Former Israeli Defence Minister Benny Gantz (2nd-R) and former Israeli army chief of staff Gadi Eisenkot (R).

Mark Schiefelbein / POOL / AFP

Eisenkot accuses Netanyahu of fear-mongering

Tuesday’s vote, Israel’s first since the October 7, 2023, Hamas attacks, is the first chance for voters to deliver a verdict on the worst security failure in generations and the wars on multiple fronts that followed.

With Netanyahu already at the helm of the most right-wing government in Israeli history, politics have shifted even further to the right. Nearly all Jewish-led parties, including that of the hawkish Eisenkot, now oppose the “two-state solution” that underpinned decades of peace negotiations with the Palestinians.

But many voters say the divisive politics of Israel’s longest-serving leader make the country weaker. Polls suggest Netanyahu’s Likud Party will lose seats, potentially depriving his coalition of right-wing, far-right and ultra-Orthodox parties of its narrow majority.

Eisenkot and an array of opposition parties ranging from the rump of the centre-left to the right, also have no clear path to unseat him.

Netanyahu, 77, is an unrivaled master of political survival: the only time since 2009 that opponents managed to wrest him briefly from the premiership, it took four inconclusive elections within two years to get him out. He was back 18 months later.

Neither side planned major public events for Monday. But both posted on social media, drumming on the election’s major themes: for Netanyahu, that he is the only leader with the mettle to face down Israel’s enemies; for his opponents, that his divisive politics have weakened the country.

Netanyahu shared an AI-generated video on Monday of Iran’s Supreme Leader Ayatollah Mojtaba Khamenei, whose father Ali Khamenei was killed on the first night of US-Israeli strikes on Iran in February. Lying in a hospital bed, the younger Khamenei says his own vote would be “definitely not Bibi. Another term like this and I will be meeting my father sooner than expected.”

On Sunday Netanyahu posted a computer-generated photo of a mushroom cloud over Tel Aviv, saying Israel was in existential danger from Iran.

Eisenkot responded by accusing him of “relying on a campaign of fear-mongering, lies, and threats – including images of nuclear bombs in the heart of Tel Aviv. This time, it won’t work for him.”

Trump’s endorsement of Netanyahu carries its own political risks a week before a legislative election in which his own Republicans are seeking to hold onto power.

The Iran war is deeply unpopular in the United States, blamed for a surge in prices especially for fuel. Major fighting has been suspended for months after ceasefire negotiations held without Israeli participation.

Source: Reuters & RNZ

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