Verizon ‘Very Serious’ About Making Bid for Netflix, Banker SaysCliff Edwards and Jonathan Erlichman
Verizon Communications Inc., the second-largest U.S. phone company, is “very serious” about a bid to acquire online movie provider Netflix Inc., an investment banker said.
Verizon may kick off a bidding war for streaming-video pioneer Netflix that could result in a sale by Easter for about $4.6 billion, said Porter Bibb, managing partner at Mediatech Capital, in a television interview yesterday on “Bloomberg West,” citing unnamed people within Verizon.
“I am hearing rumblings from inside Verizon that they are very serious about either Netflix or something similar,” Bibb said.
Chief Executive Officer Lowell McAdam told an investor conference on Dec. 7 that the company aims to move beyond its Fios TV service into the streaming-video business.
“We continue to look at alternatives,” McAdam said at a UBS investor conference in New York. Los Gatos, California-based Netflix has a market capitalization of $4.17 billion.
Verizon, based in New York, is considering an offer for Netflix because telecommunications companies are concerned they will shoulder the increasing costs of transmitting video over their networks as providers such as Netflix, Amazon.com and Hulu LLC decline to share their profits, Deal Reporter reported earlier today, citing people with knowledge of the matter.
Steve Swasey, a Netflix spokesman, and Torod Neptune, a spokesman for Verizon, declined to comment.
Netflix, which offers subscriptions for video streaming and DVDs by mail, rose 6.2 percent to $75.26 yesterday at the New York close. The stock has fallen 57 percent this year.
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