(Jan 16): Movie theatres warned European Union (EU) merger watchdogs that a takeover of Warner Bros Discovery Inc by either Netflix Inc or Paramount Skydance Corp threatens to harm their industry.
A group representing some of the biggest theatres including Odeon’s AMC Entertainment Holdings Inc, Kinepolis Group NV, and Cineworld Group plc told EU officials in a closed-door-meeting in Brussels that the takeover bids could stymie the release of blockbuster movies.
Movie theatres are “opposed to any deal that would lead to a loss of a significant proportion of future titles”, Laura Houlgatte, UNIC’s chief executive officer, said in a statement. She said that the proposed sale would also undermine the period after a film’s cinema release when it can only be seen in theatres, before appearing on streaming services.
The association, which also represents popular operators including Pathé Cinémas, UGC and Cineplexx, presented data to EU regulators highlighting how Warner Bros Discovery had increased its market share in a number of European territories as a result of a string of hits last year, including A Minecraft Movie, Final Destination: Bloodlines, and Sinners.
As scrutiny around the high profile deal intensifies, the companies and trade bodies have begun lobbying in earnest. The Brussels regulator held briefings with executives at Paramount and Netflix over the past few days, as it starts the groundwork on potentially lengthy antitrust reviews once a deal is confirmed.
Meanwhile, Paramount executives have spent the week courting European leaders in a bid to curry favour for its proposal, meeting both French President Emmanuel Macron and UK Culture Secretary Lisa Nandy in recent days.
See also: Paramount courts Macron in European charm offensive for Warner deal, Bloomberg reports
Paramount has targeted Warner Bros with multiple offers, including the current all-cash bid of US$30 per share. Warner Bros has so far rebuffed those overtures, backing Netflix’s US$27.75 stock-and-cash bid as superior. As part of any future regulatory investigation the EU watchdog would likely focus on potential competition issues in film distribution, cinema access, streaming, and any increase in the cost to consumers.
The European Commission declined to comment. Representatives at Netflix, Paramount and Warner Bros didn’t immediately respond to requests for comment.
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