Donald Trump Praises Ted Sarandos, Confirms Meeting But Says Netflix-WB Would Have “Great Big Market Share” That “Could Be A Problem”
President Donald Trump gushed over Netflix co-CEO Ted Sarandso calling him “fantastic” and more but also noted that a combined Netflix-Warner Bros. Discovery would “have a great big market share.”
That’s “for some economists to tell and I’ll be involved in that decision,” he told Deadline’s Ted Johnson on the red carpet ahead of the Kennedy Center Honors in Washington, D.C. tonight.
“He came up. He was in the Oval Office last week. I have a lot of respect for him. He is a great person,” Trump said of Sarandos. “Ted has really done a legendary job.”
He said the two had not discussed any potential guarantees in the case of a mega merger, which was ultimately unveiled on Friday. Netflix struck a deal to acquire Warner Bros. for $27.75 a share in cash and stock, beating out David Ellison’s Paramount Skydance and Comcast.
“I think in the history of Hollywood, there’s really been almost nothing like what he has done,” Trump said of Sarandos. On market share, That’s a question. They have a very big market share, and when they have Warner Bros. their market share goes up a lot” with the addition of HBO Max. “And that could be a problem.”
The deal is expected to close in 12-18 months pending regulatory approval and after Warner Bros. completes an planned separate of its its studio and streaming assets under Warner Bros. from its linear television businesses under Discovery Global. Netflix will acquire the Warner Bros. side for $23.25 in cash plus $4.50 in Netflix stock for each WB share. It has a commitment letter with Wells Fargo as lead bank for up to $59 billion of senior unsecured bridge term loans to finance the cash portion of the purchase price along. The deal has an enterprise value of $82.7 billion and a total equity value of $72 billion.
The President’s remarks tonight were his first on the merger since Netflix emerged the victor.
Netflix also agreed to a $5.8 billion breakup fee if the deal fails be approved by regulators. The streamer will be pushing the argument that despite its size it’s only one player in a massive global video market including YouTube, TikTok and others. Ellison, who made three consecutive offers for all of WBD, all rejected, before CEO David Zaslav and the company’s board opened up the process to other bidders.
Paramount’s latet bid was said to be $30 a share in cash backstopped by David Ellison’s father Larry Ellison, the Oracle co-founder who is one of the richest men in the world and a major Trump donor. David Ellison made a series of concession to the Trump administration leading up to FCC approval of Skydance’s acquisition of Paramount.
Paramount last week accused WBD of an unfair sale process that was tilted towards Netflix. It also insisted it was the only bidder with a clear path to regulatory approval. In fact, for much of the process, WBD was considered Paramount’s to lose.
