Paramount Global, under David Ellison's Skydance, has submitted a revised bid to acquire Warner Bros. Discovery (WBD), escalating a high-stakes corporate battle with streaming rival Netflix. The new offer comes just days before Netflix's own $27.75 billion all-cash deal for key WBD assets is set to be finalised.
While Paramount did not disclose the financial terms of its latest proposal, its previous offer was valued at $30 per share. This revised bid directly pressures Netflix, which now has a four-day window to raise its own offer for WBD's studio and HBO assets.
Escalating Offers and Boardroom Pressure
This marks at least the tenth time Paramount has sweetened its bid for WBD. In communications with WBD shareholders on February 17, a senior Paramount representative indicated the company was prepared to pay at least $31 per share and that its offer was not its "best and final" proposal.
David Ellison was previously overheard stating that WBD's board could not accept his $30-per-share bid without "admitting breach of fiduciary duty," as reported by Business Insider. This comment highlighted the board's legal obligation to act in shareholders' best interests, suggesting a higher bid was inevitable.
Addressing WBD's Concerns
Paramount's revised proposal specifically addresses several issues WBD had raised. These included ensuring the equity portion was fully backed by Larry Ellison's fortune and matching Netflix's higher termination fee. Paramount also stated it had accounted for a potential $2.8 billion breakup fee WBD would owe Netflix if it walked away from their existing agreement.
A central tenet of Paramount's argument is its valuation of WBD's cable networks, such as HGTV and TNT. The company contends these assets have little to no value after accounting for debt, unlike Netflix's bid which excludes them entirely.
Netflix's Counter-Argument and Political Wild Card
Netflix is positioning its offer as superior for both shareholders and the broader entertainment industry, promising that a merger would "create and protect jobs." The deal would be subject to antitrust review, introducing regulatory uncertainty.
A potential wild card is former President Donald Trump. While a White House spokesperson stated Trump remained "neutral" in the process, he later called for Netflix to remove board member Susan Rice, a former Obama and Biden administration official, "or pay the consequences." Netflix co-CEO Ted Sarandos downplayed these comments, insisting the bid for Warner Bros. is "not a political deal."
Shareholders Poised to Benefit
Regardless of the ultimate winner, the bidding war is expected to significantly benefit WBD shareholders. Kevin Mayer, Disney's former top dealmaker, predicted in December that the competition between Netflix and Paramount could inflate WBD's final sale price by $5 billion to $10 billion. The outcome will reshape the media landscape, consolidating power among a shrinking number of global entertainment conglomerates.