Key Financial Data
- Paramount launched an all-cash hostile tender for Warner Bros Discovery, arguing its offer provides greater value and a clearer regulatory path than Netflix’s deal.
- Financing for Paramount’s bid includes non-voting equity from Middle Eastern sovereign funds and Jared Kushner’s Affinity Partners, which the company says helps avoid governance and national security hurdles.
- WBD shareholders now face a direct choice between Paramount’s higher cash offer and Netflix’s agreed deal, which includes a $5.8 billion breakup fee and is positioned as more likely to close.
Paramount has taken its campaign for Warner Bros Discovery (WBD) directly to shareholders, launching a $77.9 billion hostile tender offer that challenges the company’s existing agreement to sell its studio and HBO Max streaming business to Netflix.
The all-cash, $30-per-share proposal values WBD at $108.4 billion on an enterprise basis, significantly higher than Netflix’s $72 billion offer negotiated last week.
Netflix’s bid — a mixture of stock and cash — covers only Warner’s studio and streaming business, reflecting the company’s plan to split its cable networks into a separate entity. Paramount’s tender applies to the entire company, including cable brands such as CNN, TBS and HGTV. While
Stock Price
Paramount CEO David Ellison said the tender offer reflects the same terms the company repeatedly presented privately, arguing that its cash-heavy structure provides “superior value and a more certain and quicker path to completion.” The company has submitted six proposals over the past 12 weeks, Ellison said, while accusing WBD of failing to engage meaningfully.
Ellison has contended publicly that his deal offers $17.6 billion more cash than Netflix’s, and that the combined effect of financing, equity commitments and expected synergies would deliver greater overall value. The promise of certainty is central to Paramount’s argument: Netflix is offering $27.75 per share, split between cash and stock, while asserting that a future cable spinoff will lift its valuation closer to $31 or $32 per share.
Financing for Paramount’s bid includes substantial backing from the Ellison family and RedBird Capital, as well as non-voting equity commitments from sovereign wealth funds in Saudi Arabia, Abu Dhabi and Qatar. A regulatory filing also confirmed participation from Affinity Partners, the private equity firm led by Jared Kushner. These entities have agreed to forgo governance and voting rights, a measure Paramount says should ease regulatory review in Washington and abroad.
Ellison has positioned the offer as pro-competitive, arguing that allowing the top streaming service to acquire the No. 3 service is likely to attract antitrust scrutiny.
“Allowing the number one streaming service to combine with the number three streaming service is anticompetitive,” Ellison said, while asserting that Paramount’s acquisition would create a stronger, diversified rival to Netflix and Disney. He also portrayed the Netflix deal as a threat to theatrical distribution, claiming it could lead to “the death of the theatrical movie business in Hollywood.”
Netflix, citing Nielsen’s report on share of total TV usage, maintains it holds only 8 percent of U.S. viewing time and argues its structure would pass regulatory tests. The company inserted a $5.8 billion breakup fee into its agreement — a signal of strong confidence by Netflix that it can secure all necessary approvals from federal regulators.
The political backdrop further complicates the contest. President Trump has commented on both bids, suggesting Netflix’s market share could pose antitrust concerns while also criticizing Paramount over recent CBS News editorial decisions. Ellison, who has developed a close relationship with Trump in recent months, has pitched his broader strategy to the administration, including plans to merge CNN with CBS News if the deal closes. Paramount says the resulting operation would focus on trust and reach a broad middle-of-the-road audience.
WBD shareholders have until January 8 to tender their shares unless the deadline is extended. If Warner walks away from Netflix’s deal, it would owe the streaming giant a $2.8 billion breakup fee.
Shares of WBD rose Monday amid expectations of a bidding war, while Paramount traded higher and Netflix fell. Whether Paramount can peel shareholders away from Netflix’s agreed deal now hinges on value, regulatory probability and which bidder investors believe can actually close.
