Paramount Skydance (PSKY.O) on Monday launched a hostile bid worth $108.4 billion for Warner Bros Discovery (WBD.O), opens new tab, in a last-ditch effort to outbid Netflix and create a media powerhouse that would challenge the dominance of the streaming giant.
Netflix had emerged victorious on Friday from a weeks-long bidding war with Paramount and Comcast, securing a $72 billion equity deal for Warner Bros Discovery’s TV, film studios and streaming assets. But Paramount’s latest attempt means the jockeying for Warner Bros and its prized HBO and DC Comics assets will not come to a conclusion swiftly.
Netflix’s offer comes with a $5.8 billion break-up fee and was likely to face strong antitrust scrutiny; U.S. President Donald Trump raised questions about the offer over the weekend. The bid has already drawn sharp criticism from bipartisan lawmakers and Hollywood unions on concerns that it could lead to job cuts as well as higher prices for consumers.
Twists and turns
However, Paramount’s bid could also face its own level of scrutiny. A Paramount-Warner Bros combination would boost its dominant position in the studio business that some also worry could lead to job losses as the industry rapidly consolidates.
Reuters had already reported, citing sources familiar, that Paramount had raised its offer to $30 per share on Thursday for the entire company, but that the Warner Bros board had concerns about the financing.
“The Warner Bros Discovery acquisition is far from over. Netflix is in the driver’s seat but there will be twists and turns before the finish line. Paramount will appeal to shareholders, regulators, and politicians to try to stymie Netflix. The battle could become prolonged,” said Emarketer senior analyst Ross Benes.
Paramount submitted multiple offers starting in September to forge an entertainment powerhouse capable of challenging Netflix and tech giants such as Apple that have expanded into media but faced rejections.
Paramount remains one of Hollywood’s major studios, but its box office record has been uneven, with occasional franchise wins offset by periods in which its slate has trailed Disney, Universal and Warner Bros in U.S. market share.
It had sent a letter to Warner Bros, questioning the sale process and alleging the company has abandoned a fair bidding process and predetermined Netflix as the winner.
That followed reports that Warner Bros’ management called the Netflix deal a “slam dunk” while speaking negatively about Paramount’s offer.
‘Bias against us’
In an interview with CNBC on Monday, Paramount CEO David Ellison said there is an “inherent bias” against his company in the bidding. “We will be the largest investor in this deal. We’re literally sitting here today because we are fighting for our shareholders, and we’re also fighting for the shareholders of Warner Bros Discovery,” Ellison said in an interview with CNBC.
Some analysts and industry experts see Paramount as the best candidate for acquiring Warner Bros Discovery, given Ellison’s deep pockets – backed by his father, Oracle co-founder and the world’s second-richest person, Larry Ellison, who has close ties with the Trump administration.
Bloomberg News has reported Trump met Netflix co-CEO Ted Sarandos in mid-November, telling the executive Warner Bros should sell to the highest bidder.
The combined company will have substantial overlap and its combined streaming revenue would decline unless Netflix doubles its prices or runs separate platforms, neither of which the brokerage expects, Morningstar analysts have said.
Looking to allay antitrust fears, Sarandos had said the deal would drive value for consumers, shareholders and talent, saying Netflix is “highly confident” in the regulatory process.
Analysts said Netflix’s motivation would stem from securing exclusive, long-term control over premium IP and reducing reliance on external studios as it expands into gaming, live entertainment and broader consumer ecosystems.
Access to WBD’s vast IP trove would provide immediate credibility, audience reach and merchandising potential for its gaming ambitions, an area where Netflix is still building original content and brand recognition.