Board rejects Paramount Skydance takeover bid
The board of Warner Bros. Discovery has unanimously recommended that shareholders reject a hostile takeover offer from Paramount Skydance and instead support what it described as a superior merger proposal from Netflix.
Paramount launched a $30-per-share all-cash tender offer directly to Warner Bros. Discovery shareholders last week, valuing the company at an enterprise value of about $108.4 billion. Paramount Skydance chief executive David Ellison has argued that the bid offers stronger regulatory prospects than the competing Netflix proposal.
Concerns over value, certainty, and financing
In a statement released Wednesday, board chair Samuel Di Piazza said the Paramount offer carried “significant risks and costs” and failed to provide adequate value. The board highlighted concerns about financing structure, noting that more than $40 billion of the proposed funding did not come directly from the Ellison family.
Warner Bros. Discovery also cited the recent exit of Jared Kushner’s Affinity Partners from the Paramount-led bid and questioned the reliability of third-party financing, including capital expected from Gulf state sovereign wealth funds.
Netflix proposal seen as cleaner and more certain
Netflix has proposed a cash-and-stock transaction valuing Warner Bros. Discovery’s streaming and studio assets at roughly $72 billion in equity value, or about $83 billion including debt. Under the deal, Warner Bros. Discovery’s cable networks would be spun off into a separate company.
According to the board, Netflix’s offer includes no equity financing risk, strong debt commitments, and a high termination fee, providing greater certainty of closing. Di Piazza said the structure directly addressed operational concerns raised during the strategic review process.
Paramount leaves door open to higher bid
Although Warner Bros. Discovery formally rejected the Paramount Skydance proposal, the decision could prompt a revised offer. Ellison has previously indicated that the $30-per-share bid was not final, though Paramount said Wednesday it does not currently plan to increase its offer.
Some shareholders, including GAMCO Investors CEO Mario Gabelli, said maintaining competitive tension between bidders could still benefit investors.
Regulatory outlook and next steps
Di Piazza dismissed concerns that antitrust scrutiny would favor one deal over the other, stating that both transactions would need to navigate review by the U.S. Department of Justice. Netflix executives echoed that view, saying they are prepared to defend the deal if challenged.
Warner Bros. Discovery expects to hold a shareholder vote on the Netflix merger in the spring or early summer, with a final date yet to be determined.