Warner Bros Discovery edges closer to reopening Paramount talks, threatening Netflix's $83bn deal
A sweetened hostile bid, a $650m-per-quarter pressure mechanism and restless shareholders are forcing WBD's board back to the table, setting the stage for Hollywood's biggest bidding war
Warner Bros Discovery's board is weighing whether to restart negotiations with Paramount Skydance, a move that would blow open the most consequential media deal in years and put Netflix's carefully constructed acquisition at serious risk.
The discussions, first reported by Bloomberg, come after Paramount aggressively upgraded its $108.4bn hostile cash offer for the media conglomerate. The company is now offering to cover a $2.8bn breakup fee owed to Netflix if WBD abandons its existing agreement, backstop a multibillion-dollar refinancing to eliminate $1.5bn in costs, and pay a "ticking fee" of roughly $650m in cash per quarter if the deal hasn't closed by year's end.
That's a lot of financial firepower pointed squarely at WBD's boardroom.
Paramount's political flanking move
The financial offensive isn't happening in isolation. Paramount moved last week to shore up its political positioning by hiring Rene Augustine, a former Trump administration attorney, as senior vice-president of global public policy. In a deal of this magnitude, with regulatory scrutiny all but guaranteed, Washington relationships matter.
David Ellison, Paramount's chair and chief executive, framed the escalating pursuit as evidence of "strong and unwavering commitment to delivering the full value WBD shareholders deserve."
Shareholder pressure mounts, but commitments remain thin
WBD acknowledged it is reviewing Paramount's amended offer, and some activist shareholders are pushing the board to engage. Pentwater Capital Management and Ancora Holdings Group have both pressed for talks with the rival bidder.
But the numbers tell a more cautious story. Shareholders representing less than 2% of WBD's stock have committed to Paramount's hostile bid so far. The company has already extended its deadline twice; it now stands at 20 February.
Two very different visions for WBD's future
The competing offers represent fundamentally different outcomes for the company.
Netflix's deal, sweetened in January to an all-cash structure, targets WBD's crown jewels: the Warner Bros studio (home to Harry Potter, Superman and Batman) and HBO (Game of Thrones, The White Lotus, Succession). Under this arrangement, WBD's global network operations, including CNN, Cartoon Network and Discovery Channel, would be spun off, with existing investors retaining a stake in that business.
Paramount wants the whole thing. Every studio, every network, every channel.
If WBD's board decides to formally engage with Paramount, it must notify Netflix first, a procedural step that would almost certainly trigger another round of improved offers from both sides.
The clock is ticking
WBD had previously scheduled a special shareholders' meeting for some point in April to vote on the Netflix merger. Whether that vote happens as planned now depends on what the board decides in the coming days.
Board members are reportedly debating whether Paramount's offer represents a better deal, but no decision on how to respond has been reached. With the 20 February deadline looming and hundreds of millions in quarterly incentives on the table, the pressure to act is only growing.
Hollywood's biggest corporate drama isn't waiting for a greenlight. It's already in production.
