Paramount Skydance mounted a $108.4billion hostile takeover bid on 8 December 2025 for Warner Brothers Discovery (WBD), setting up a high-stakes battle with Netflix, which has already agreed to acquire WBD’s studios and streaming assets for $82.7billion.
The bid, led by David Ellison, targets the entire company including its cable networks in contrast to Netflix’s narrower deal focused on film, television and streaming.
In a historic shift from its “builders, not buyers” philosophy, Netflix announced a definitive agreement on 5 December to acquire the film and television studios and streaming assets of WBD for approximately $82.7billion.
Board rejects offer
WBD’s board has repeatedly rejected Paramount’s proposals, most recently in early January, calling the revised offer “inadequate.” Directors cited concerns over the structure of the deal, particularly its heavy reliance on debt financing and the risks tied to closing the transaction.
Instead, the board has reaffirmed its support for the Netflix agreement, which it views as offering greater certainty and a clearer path forward.
The Core Dispute: Valuation of “Discovery Global”
At the center of the dispute is how to value WBD’s traditional cable networks, including CNN, TNT and Discovery.
Netflix plans to spin these assets off into a separate entity, “Discovery Global”, arguing shareholders will benefit from owning both that company and Netflix stock. Analysts have estimated the cable unit could be worth up to $4 per share.
The board argues that shareholders will gain more total value from owning a stake in the newly independent Discovery Global plus Netflix stock. Analysts estimate these cable assets could be worth up to $4.00 per share.
Paramount claims these assets are “effectively worthless” in the current market using Versant, Comcast’s recent cable spinoff, as a benchmark whose stock plummeted 25% in its first week of trading. Paramount values Discovery Global at $0.00 per share.
Paramount argues its $30.00 all-cash offer for the entire company is “unmistakably superior” to the Netflix deal, which they calculate is now worth only $27.42 due to recent drops in Netflix’s stock price.
We believe our offer will create a stronger Hollywood. It is in the best interests of the creative community, consumers and the movie theater industry.
Paramount CEO David Ellison
Larry Ellison’s $40.4billion personal guarantee
To address the WBD board’s concerns about the “certainty” of the deal, Oracle co-founder Larry Ellison strengthened his commitment on 22 December 2025.
Ellison replaced a revocable trust with an irrevocable guarantee of $40.4billion in equity financing. The guarantee is anchored by approximately 1.16billion shares of Oracle common stock.
Despite this, the WBD board remains wary, noting that the deal still requires $54billion in debt, which would create the largest leveraged buyout in history and saddle the company with a total of $87billion in debt.
Paramount’s offer continues to provide insufficient value, including terms such as an extraordinary amount of debt financing that create risks to close and lack of protections for our shareholders if a transaction is not completed.
Samuel Di Piazza Jr., WBD Chair
Legal and Industry challenges
President Donald Trump weighed in on the fight for control of Warner Bros. Discovery on Wednesday, declaring that “CNN must be sold.”
Regulators in the US and Europe are expected to closely examine the merger. Lawmakers and rivals argue a combined Netflix-HBO would control over 40% of the SVOD market, potentially harming competition.
WBD’s top shareholders, including Vanguard, State Street, and BlackRock (controlling 22% of shares), are reportedly split. While some appreciate the “certainty” and investment-grade rating of Netflix, others favor Paramount’s higher cash price and believe a Paramount-WBD merger would face fewer regulatory hurdles than a Netflix-WBD dominant streaming giant.
Trade groups like Cinema United have called the deal an “unprecedented threat” to movie theaters, fearing Netflix might prioritize streaming over theatrical releases. The Writers Guild of America (WGA) and other unions have urged the Department of Justice to block the merger, warning of potential job losses and reduced content diversity.
A Paramount Skydance-Warner Bros merger would be a five-alarm antitrust fire and exactly what our anti-monopoly laws are written to prevent.
US Senator Elizabeth Warren
Read also: Netflix acquires Warner Brothers Discovery
