Halbower's letter to WBD: Netflix merger has greater regulatory risk than Paramount merger

Watch on YouTube ↗  |  January 07, 2026 at 16:01  |  5:19  |  CNBC
Speakers
Matt Halbower — CEO, Pentwater Capital Management

Summary

Matt Halbower, CEO of Pentwater Capital Management and a large WBD shareholder, sent a letter criticizing the Warner Bros. Discovery board for refusing to engage with Paramount's revised $30-per-share all-cash bid. He argues the Paramount offer is economically superior and less risky than Netflix's competing deal, and that Paramount's financing is credible despite board concerns about leverage. The discussion focuses on merger-arb dynamics, regulatory risk, and whether Paramount could raise its bid.

  • Pentwater's Matt Halbower says WBD's board should engage with Paramount's revised $30-per-share all-cash bid.
  • He calls Paramount's offer economically superior and lower regulatory risk than the Netflix deal.
  • Halbower says Paramount's $30 offer is not best and final, implying a higher bid is possible.
  • He disputes WBD board leverage concerns, citing $54 billion Paramount deal debt versus $59 billion Netflix deal debt.
  • He cites Ellison family and Middle East equity, plus Bank of America and Citibank commitments, as making Paramount financing credible.
  • He warns the WBD board may be harming shareholder value by not fully engaging Paramount.
  • The discussion examines risk-arb shareholder influence in the WBD merger contest.
Ideas
Matt Halbower CEO, Pentwater Capital Management 1:22
WBD should engage Paramount's superior cash bid
Halbower argues the Warner Bros. Discovery board should engage with Paramount's revised $30-per-share all-cash bid because it is economically superior to the Netflix deal, carries less regulatory risk, and is not necessarily final, so Paramount could raise its offer. He warns that refusing to engage risks losing a value-maximizing opportunity and harming WBD shareholder value.
WBD HIGH
Matt Halbower CEO, Pentwater Capital Management 4:03
Paramount bid financing appears credible
Paramount's revised WBD bid is credible and financeable: the transaction would carry about $54 billion of debt versus $59 billion under Netflix's deal, the Ellison family and Middle East partners are putting up more than $41 billion of equity, and Bank of America and Citibank are contractually committed. He therefore calls Warner's leverage-risk argument specious and expects Paramount can close and may improve its offer.
PSKY HIGH
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This CNBC video, published January 07, 2026, features Matt Halbower discussing WBD, PSKY. 2 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Matt Halbower  · Tickers: WBD, PSKY