Paramount Skydance's Hostile Warner Bros. Bid, Nvidia Wins Trump's Approval to Sell Chips in China

0:01Bloomberg Audio Studios Podcast Radio News. Good morning, I'm Nathan Hager. And I'm Karen Moscow. Here are the stories we're following today. Karen, we begin with the latest on the takeover battle for Warner Brothers Discovery. Paramount Skydance has launched a hostile takeover bid for the studio backed by banks, billionaires, and sovereign wealth funds. The move comes just days after Warner's agreed to a deal with Netflix. The Paramount offer stands at$30 a share in cash compared with Netflix's cash and stock bid of just under 28 per share. President Trump's son-in-law, Jared Kushner, is participating in the Paramount bid, but the president himself has downplayed his involvement, saying he's not close to either Paramount or Netflix.

0:49I have to see what percentage of market they have. We have to see the Netflix percentage of market Paramount, the percentage of market. I mean, none of them are particularly great friends of mine. President Trump spoke to the White House while Netflix co-CEO Ted Sarando says Paramount's bid was expected. Today's move was entirely expected. We have a deal done and we are incredibly happy with the deal. We think it's great for our shareholders. We think it's great for consumers. We think it's a great way to create and protect jobs in the entertainment industry. We're super confident we're going to get it across the line and finish.

1:24So we're excited. Netflix co-CEO Ted Sarando spoke at the UBS Global Media and Communications Conference in New York. Paramount wants to buy all of Warner Brothers while Netflix is seeking only the Hollywood Studios, HBO and the streaming business. Shares of Warner Brothers Discovery are up one and a half percent this morning. Well, let's turn to the chip space now, Nathan. President Trump has granted NVIDIA permission to ship its H200 artificial intelligence chip to China in exchange for a 25 percent cut of the sales. The decision marks a major lobbying win for NVIDIA and could let it regain business lost in the Chinese market.

2:00Bloomberg's Wendy Benjaminson has more from Washington. So now Trump, who is the most transactional president I think we've had in a long time, is looking at this purely from a business perspective. He is looking at this as the U.S. will get a 25 percent cut out of this tremendous market that NVIDIA is going into. NVIDIA gets the win. Apparently, the other companies, AMD and Intel, will as well, presumably also with a cut to the United States. Bloomberg's Wendy Benjaminson reports that President Trump says the sales would only go to quote approved customers. And checking shares of NVIDIA, they're up one and a half percent this morning.

2:37Another tech stock is in focus this morning, Karen. That would be Google Parent Alphabet. the European Union is investigating Google now over fears it may have abused its dominance by using its own artificial intelligence tools to squeeze out competition. The EU's watchdog will examine whether Google distorted competition by imposing unfair terms on content creators and giving its own AI model an advantage over rivals. This fresh probe follows September's three and a half billion dollar fine against Google for allegedly favoring its own ad tech services over rivals. That provoked President Trump's ire.

3:11He slammed the fine as discriminatory. Meanwhile, Nathan, President Trump says he plans to sign an executive order on artificial intelligence. He says it'll establish one rule for regulating the technology, not multiple rules from all 50 states. Bloomberg's Mike Shepard has more from Washington. The federal government has not enacted its own AI-specific rulemaking or law so far, Even three plus years after the genesis of ChatGPT, and even after we've been talking about artificial intelligence for many years more than that, we still do not have a comprehensive set of federal regulations and rules to set the rules of the road.

3:53And Bloomberg's Mike Shepard says the forthcoming order marks the latest bid by President Trump to put his imprint on AI policy. Well, the president continues to put his imprint on trade policy, Karen, and now he is warning that he could impose new tariffs on Canadian fertilizer and Indian rice. The president issued that threat at a White House event where he announced billions of dollars in assistance for farmers. When they take fertilizer out of the country, all of a sudden we don't do it anymore. Then they start charging and sending very high prices from other countries, whether it's Canada or somebody else.

4:25We're not going to let that happen. President Trump says the U.S. doesn't need Canadian fertilizer, but Canada is America's biggest supplier of potash. As for rice, India is the world's biggest exporter, but the U.S. sells more rice abroad than it brings in, and most of the rice it buys is from Thailand. President Trump is holding an event in Pennsylvania tonight to discuss his administration's efforts to tackle rising prices. Well, let's turn to geopolitics now, Nathan, and the grinding effort to end the war in Ukraine. President Volodymyr Zelensky met yesterday with the leaders of the U.K., France and Germany.

4:58He says they agreed to keep working on security guarantees, a signal that there's still no breakthrough toward a peace agreement with Russia. But European leaders may be getting closer to a deal on using frozen Russian assets to back a loan for Ukraine, as we hear from Bloomberg's Oliver Crook in Brussels. If they are able to get this over the line, this would account basically 90 billion euros worth of funding for Ukraine over the next period of time. As you say, that goes about two-thirds of the way of covering the funding that they require for running the country and running the military, which is about$135 billion.

5:31So that would be a major step. Bloomberg's Oliver Crook reports European leaders are sounding more confident they can reach an agreement by Christmas or even as soon as this week. They'll meet in Brussels next week to try to seal the deal. Joining me back to the economy now, Karen, the Federal Reserve kicks off its final policy meeting of the year today. Investors expect the Fed will cut rates by a quarter point, the third cut this year at the conclusion of the two-day meeting. But the messaging around the decision is uncertain. Let's get a preview from Bloomberg's Michael McKee. The nation's central bankers are more divided over policy than they have been in years.

6:06They're supposed to keep inflation down and employment up, but inflation is rising and job growth is slowing. Wall Street is betting Fed officials will decide it's more important to offer relief to the labor market and deliver their third consecutive quarter point rate cut. At least two voters are likely to dissent, worried that the Fed is setting the stage for inflation to accelerate. One more, Stephen Myron, is expected to dissent in favor of President Trump's demand for a half point cut. The dissents will come with the decision at 2 p.m. Wall Street time tomorrow. Michael McKee, Bloomberg Radio.

6:42All right, Mike, thanks. And for full coverage of the decision and remarks from Chair Jay Powell, tune in to a special edition of Bloomberg Surveillance, The Fed Decides. That kicks off tomorrow at 1.30 p.m. Wall Street time on Bloomberg Radio, Bloomberg Television, and the Bloomberg Podcast channel on YouTube. In company news, Nathan Pepsico announced a series of operational changes backed by activist investor Elliott Investment Management, including a review of its supply chain and slashing its overall number of products. Again, more from Bloomberg's Alexis Christophorus. The maker of Lay's and Doritos says it will lower some food prices and reduce costs while cutting the number of individual products by 20 percent across its U.S.

7:22businesses. PepsiCo also asks some employees to work from home this week, possibly signaling layoffs ahead. The deal avoids a potentially long and costly battle with activist investor Elliott Management, which holds a roughly four billion dollar stake in PepsiCo. And that's Bloomberg's Alexis Christophorus reporting. And Karen Disney is bringing back its late night star for at least one more year.

7:48Bloomberg News has learned Jimmy Kimmel will continue to host his ABC late night talk show until at least May of 2027. Kimmel, you may recall, was suspended in September this year over remarks about murdered Republican activist Charlie Kirk. Sources say Kimmel and Disney agreed on the extension months ago, but delayed the announcement out of respect for fellow late-night host Stephen Colbert, who is being let go from his show by CBS. Kimmel has been hosting Jimmy Kimmel Live on ABC since 2003.

8:21Time now for a look at some of the other stories making news in New York and around the world. And for that, we're joined by Bloomberg's Michael Barr. Michael, good morning. Good morning, Karen. The Supreme Court will decide whether to overturn a 90-year precedent and possibly expand the power of the Oval Office. At issue, President Trump's firing earlier this year of Rebecca Slaughter, a Democrat appointed to the Federal Trade Commission in 2018. Now the justices are weighing if the president has executive authority to terminate officials from independent federal agencies without cause. Former FTC Commissioner Alvaro Bedoya says a rollback could be problematic.

8:59It's going to unleash a tidal wave in government because the FTC does certain things we protect against increases in grocery prices, pharma bro, Martin Shkreli, driving up critical medicine in terms of costs. The Supreme Court will hear arguments next month. A former personal lawyer for President Trump is stepping away from her role as acting U.S. attorney for New Jersey. In Stepping Down, Alina Habba says she aims to protect the stability and integrity of the U.S. Attorney's Office in New Jersey. A panel of the Third Circuit Appeals Court ruled against her interim appointment. Attorney General Pam Bondi says Habba will continue on in the Justice Department as a senior advisor.

9:40Billions have been set aside for the nation's farmers. The financial relief is to offset the losses from the Trump administration's tariffs. China has since agreed to purchase American soybeans again as part of a framework deal with the U.S. President Trump says$11 billion of the$12 billion package will go to the newly created Farmer Bridge Assistance Program under the Department of Agriculture. What we're doing is we're taking a relatively small portion of that and we're going to be giving and providing it to the farmers in economic assistance and we love our farmers and as you know the farmers like me.

10:20President Trump made the announcement at a meeting with farmers at the White House. Global News, 24 hours a day and whenever you want it. With Bloomberg News Now, I'm Michael Barr and this is Bloomberg, Karen. Thanks, Michael. Time now for our Bloomberg sports update. And for that, we bring in John Stashauer. Thanks, Karen. Overtime in Los Angeles, the Chargers and Eagles both scored only one touchdown. There were nine field goals and Cameron Dicker's fifth of the night was a 54-yarder in overtime. Chargers beat the Eagles 22-19. Philly has lost three in a row. The Colts just lost their quarterback Daniel Jones to a season-ending injury.

10:56They're working out Phillip Rivers, the former Colt who turned 44 yesterday. He's been retired for five years. Two games in the NBA tonight to start the NBA Cup quarterfinals. That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this. As markets move and headlines break, what matters most is context. A Bloomberg subscription gives you unmatched reporting, sharp analysis, and powerful tools that help you connect the dots. Visit Bloomberg.com slash podcast offer to learn more. Coast to coast on Bloomberg Radio, nationwide on Sirius XM, and around the world on Bloomberg.com and the Bloomberg Business app.

11:41This is Bloomberg Daybreak. Good morning, I'm Nathan Hager. The bidding war for Warner Brothers Discovery is really a war now, with Paramount Skydance making a hostile takeover offer of$30 a share. That's more than the$27.75 Netflix is offering for the company without its basic cable networks. Paul Hardhart with the NYU CERN School of Business says no matter who wins this battle, Hollywood is changing. What you are going to see is the end of a Hollywood studio to some degree, whether it goes to Netflix, whether it goes to Comcast, whether it goes to Paramount. And I think that's a shift. That's Paul Hardart, head of the Entertainment Media and Tech Program at the NYU Stern School.

12:22And we're joined now by Bloomberg Markets reporter Valerie Teitel. And not only does this change Hollywood, Valerie, but both of these offers could really be in for some serious scrutiny. Good morning. Hey, good morning, Nathan. And yes, the Warner Brothers board has said that they're aiming to advise stockholders on the recommendation from this hostile Paramount offer within 10 business days. This is going to keep us busy essentially heading into the Christmas season. What's important to note this morning, though, is we're continuing to see the market move of yesterday continue in pre-market.

12:54Paramount Skydance is again on a front foot up nearly 2%. It rose 9 % yesterday on the back of this news. Warner Brothers Discovery in the green as well. Netflix in the red. So there does seem to be some positivity about a potential warming up to this Paramount Hostile takeover. It does have a lot of things going for it. As you mentioned, the cash offer for$30 a share does succeed, and Netflix is$27.75 per share. And also, it is a very simplified plan. They want to present to Warner Brothers the ability that Paramount has to close the deal quickly. A lot of that has to do with regulatory oversight, Paramount's involvement in this deal could potentially be an avenue if Warner Brothers is concerned that regulators would eventually smack down a Warner Brothers Netflix merger on the back of essentially becoming too large of a streaming giant for the market.

13:47That was some concerns that President Trump brought up himself over the weekend when he was speaking alongside reporters. The other thing to mention is that alongside the company trying to pitch that they can close this deal quickly. The Ellison family is essentially backing all of the equity that is being provided from the likes of Middle Eastern pension funds to Jared Kushner's fund as well. So there is a big backing when it comes to the one of the U.S.'s most richest, wealthiest families, wealthiest man wanting to guarantee the deal. Well, what about potential pushback for this deal? Just the fact that President Trump's son-in-law is involved in this, could that lead to some pushback?

14:32It's a really hard thing to measure because on some sides you could see the shareholders viewing the proximity to the U.S. president that a lot of this deal has as a benefit. Because one thing they are worried about is that this deal eventually being smacked down by the regulators. That's the one big worry with Netflix. But if you take a look at the Paramount deal, not only does it involve a lot of Middle Eastern investors who we know that President Trump has essentially, you know, he went on a big trip to the Middle East to try to get this investment into the U.S. It also has Jared Kushner and his son-in-law involved.

15:07So maybe the ties of the president could be a positive thing for Warner Brothers Discovery. This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond. Look for us on your podcast feed by 6 a.m. Eastern each morning on Apple, Spotify, or anywhere else you listen. You can also listen live each morning starting at 5 a.m. Wall Street time on Bloomberg 1130 in New York, Bloomberg 99.1 in Washington, Bloomberg 92.9 in Boston, and nationwide on Sirius XM Channel 121. Plus, listen coast-to-coast on the Bloomberg Business app now with Apple CarPlay and Android Auto interfaces.

15:45And don't forget to subscribe to Bloomberg News Now. It's the latest news whenever you want it, in five minutes or less. Search Bloomberg News Now on your favorite podcast platform to stay informed all day long. I'm Karen Moscow. And I'm Nathan Hager. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

16:15Thank you.