Mr. Sarandos is going to Washington – again.
Netflix CEO Ted Sarandos is heading to the nation’s capital on Thursday to mount a last-ditch effort to save his deal to buy Warner Bros. Discovery’s streaming service and studio, On The Money has learned.
As first reported by The Post, Sarandos and his ever-growing team of lobbyists have launched a government charm offensive this week — including a possible meeting with President Trump — to address growing antitrust concerns and some ill-timed, anti-Trump comments made by one of his board members.
Sarandos will personally make an appearance at the White House on Thursday, though as of press time, it’s unclear if he will meet the president, people close to the matter told The Post. He met with Trump in November, The Post previously reported.
Sarandos needs to mollify the intensifying antitrust concerns of Netflix plans to layer WBD’s streaming service over its own, essentially placing the No. 3 and No. 1 streamer under one roof along with WBD’s studio.
Meanwhile, GOP lawmakers believe Netflix’s programming skews to the left and aren’t looking to give it more market power. There’s also the matter of Susan Rice, the partisan Democrat and former Obama national security chief who is a Netflix board member.
She recently appeared on a podcast in which she ripped Trump and warned that corporations that “take a knee” to the Trump administration should expect to be “held accountable” if Dems return to power.
In response, Trump demanded that Sarandos either fire Rice or “pay the consequences.”
A Netflix spokeswoman has declined to comment about Rice’s remarks and Sarandos’s Thursday visit to DC. A White House press rep also had no immediate comment. But one senior Trump regulatory official after hearing the news about the visit, quipped with a laugh: “Maybe Sarandos will let Susan Rice tag along.”
Netflix shareholders have been clamoring for Sarandos to call his deal ambitions quits given the costs involved and the debt the streaming giant will need to issue to cover the hefty $73 billion price tag for HBO Max, and the Warner studio. Shares rose nearly 6% Wednesday as speculation swirled that Sarandos will at some point walk away from the transaction.
Meanwhile, the maneuvers by Sarandos come as Netflix faces so much pushback that Warner Bros. Discovery itself announced Tuesday it is now weighing whether to ditch its planned $27.75 a share transaction with the streaming giant. It is reviewing a sweetened, “reasonably superior” bid by rival Paramount Skydance.
Known as PSKY, the company is now proposing to buy the entirety of WBD — including its cable properties like CNN — for a recently sweetened $31 a share or more than $80 billion. If the WBD board does deem the bid superior, Netflix will have a chance to match.
Warner Bros. was set to announce earnings Thursday morning and could theoretically make an announcement on the enhanced PSKY offer.
Run by indie producer David Ellison, his mega billionaire father, the Oracle co-founder Larry Ellison and partners at RedBird Capital, PSKY’s biggest selling point is a glide path to regulatory approval since its deal includes less significant overlap than Netflix. Recently, they have won over several top WBD shareholders including famed value investor Mario Gabelli.
WBD investors will have the final say on the matter at a March 20 shareholder vote.
The war for the future of WBD has captivated Wall Street, Washington and the media business for the past six months given the culturally important properties at stake: The legendary Warner studio, the HBO Max streaming service and cable news network CNN, plus the bold-faced names involved in the negotiations such as Sarandos, David Zaslav of WBD and Larry Ellison, one of the world’s richest men.
PSKY’s hostile bid, an appeal directly to shareholders, came after WBD’s board in December voted to approve the Netflix offer, mainly over concerns about PSKY’s financing arrangements. Initially WBD joined Netflix arguing to investors that ultimately Trump’s antitrust cops will see past any consumer price-gouging concerns because of programming competition from social media.
But the argument has recently been met with skepticism inside the Trump DOJ’s antitrust division that is now in the early stages of scrutinizing Netflix’s business model as a monopoly under Section 2 of the Sherman Act, as The Post has reported.
If the deal, as expected, is opposed by the White House, Netflix will have to litigate to win control of the streamer and studio, a process that could take two years meaning investors won’t see a dime until then. It will also face regulatory scrutiny for state attorneys general and EU regulators.
As the regulatory heat on the Netflix deal grows, even some WBD supporters are growing wary of its chances of survival.
“They have some work to do in DC,” said one senior WBD executive.
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