In a significant development within the global media landscape, Warner Bros. Discovery has formally recommended its shareholders reject an unsolicited, all-cash acquisition bid from Paramount Global. The company's board has declared that the existing proposal from Netflix for its studio and streaming assets remains a superior deal for its investors.
The Battle for Warner: Two Competing Visions
The corporate tussle escalated on Wednesday, 17th December 2025, when Warner's board publicly dismissed Paramount's hostile offer, valued at $77.9 billion or $30 per share. This move came shortly after Netflix, earlier in the month, had agreed to a $72 billion ($27.75 per share) cash-and-stock deal to acquire Warner's studio operations and the HBO Max streaming service. This Netflix agreement is contingent on Warner first splitting itself into two separate entities.
Warner's rejection was communicated through a detailed letter to its shareholders. The company raised serious doubts about the credibility of Paramount's proposal, labelling it as "illusory." A primary concern centred on the funding structure, which relies heavily on the Ellison family. Paramount's CEO, David Ellison, and his father, Oracle co-founder Larry Ellison, are majority shareholders in Paramount alongside RedBird Capital.
Warner pointed out that the Ellison family's commitment is structured through a revocable trust, and the provided documentation contains "gaps, loopholes and limitations that put you, our shareholders, and our company at risk." In stark contrast, Warner highlighted that the Netflix merger is backed by a publicly traded company with a market capitalisation exceeding $400 billion and an investment-grade balance sheet.
Funding Shifts and Regulatory Perspectives
The composition of Paramount's bidding consortium has also seen changes. Initially, the bid included capital from three Gulf sovereign-wealth funds and Jared Kushner's Affinity Partners. However, as of Tuesday, Affinity Partners confirmed it is no longer involved in the deal. A spokesman stated the investment dynamics had changed significantly since October, though the firm still sees strategic merit in Paramount's offer.
On the regulatory front, Paramount had argued its all-cash offer for the entire company would face smoother antitrust scrutiny. Warner's board countered this claim on Wednesday, stating it does not believe there is a "material difference in regulatory risk" between the two competing proposals.
Warner's stock closed at $28.90 per share on Tuesday, sitting between Netflix's $27.75 offer and Paramount's $30 bid. Notably, Paramount has signalled that its $30 per share offer is not its "best and final" proposal, leaving the door open for a potential increase. Their tender offer is currently set to expire on 8th January, but can be extended.
Board Engagement and The Path Forward
Responding to Paramount's claims of a lack of engagement, Warner stated its board had held dozens of calls and meetings with all parties, including the Ellisons. The company said it repeatedly raised its funding concerns and provided multiple opportunities for Paramount to amend its offer.
The core of Warner's argument rests on certainty and value. The board concluded that the Netflix merger terms are superior, asserting that the Paramount offer "provides inadequate value and imposes numerous, significant risks and costs." With this firm recommendation to shareholders, the ball now lies in Paramount's court to decide whether to enhance its bid or withdraw, setting the stage for the next chapter in this high-stakes media merger saga.
