A dramatic corporate battle is unfolding over Warner Bros Discovery, with Netflix planning an all-cash countermove to defeat a hostile takeover by Paramount Skydance. Netflix’s $83 billion bid for WBD’s entertainment assets is being retooled to provide immediate cash to shareholders, aiming to trump Paramount’s complex, debt-financed $108.4 billion offer.
Paramount, led by the Ellison family, is not going down without a fight. They are attempting to nominate new directors to WBD’s board to vote against the Netflix deal. Their bid is backstopped by a massive $40 billion guarantee from Larry Ellison, but WBD’s current board has steadfastly refused the offer, citing the dangers of the associated debt.
Netflix’s pivot to cash is an attempt to cut through the boardroom politics and offer shareholders a deal they cannot refuse. The acquisition would see Netflix take over the Warner Bros studio and HBO, home to franchises like Batman and The White Lotus. Meanwhile, WBD’s cable news and factual networks would be spun off.
The intensity of the bidding war has drawn the attention of US regulators. Politicians are voicing concern that the resulting Netflix-Warner combine would control nearly 50% of the streaming market. This regulatory scrutiny puts pressure on Netflix to close the deal quickly before opposition hardens.
Despite the turmoil, Wall Street is responding positively to Netflix’s aggression. Shares in both companies ticked up as the all-cash plan was reported. The situation remains fluid, with the fate of one of Hollywood’s oldest studios hanging in the balance between two media titans.
