Warner Bros. Discovery Backs Netflix Deal While Reopening Talks with Paramount
Warner Bros. Discovery (WBD) has reaffirmed its strong support for its merger agreement with Netflix, even as it temporarily reopens discussions with Paramount Global over a potential competing bid. The media giant stated it wants to hear Paramount's best and final proposal and has opened a short window for renewed negotiations. At the same time, WBD is actively urging shareholders to reject Paramount's current hostile offer and instead approve the Netflix deal.
Details of the Netflix Transaction
WBD previously agreed to sell most of its studio and streaming assets, including the Warner Bros. film studio and HBO, to Netflix. Its cable networks, such as CNN, are expected to be spun off into a separate entity. The Netflix transaction values the studio and streaming assets at $27.75 per share, a figure that has been central to the ongoing negotiations.
Paramount's Competing Bid
Paramount, led by CEO David Ellison, responded by bypassing WBD's board and offering shareholders $30 per share for the entire company, including CNN. According to WBD, Paramount recently signaled it could raise its bid to $31 per share if formal talks resumed, though it left open the possibility of going even higher. This move has intensified the high-stakes battle for control of Warner Bros. Discovery.
Negotiation Dynamics and Waivers
Despite having a signed merger agreement with Netflix, WBD has secured a limited seven-day waiver from the streaming giant to hold discussions with Paramount. In a letter to Paramount's board, WBD requested a definitive offer, effectively asking the company to present its highest binding bid. WBD CEO David Zaslav emphasized that the company's priority remains maximizing value and certainty for shareholders.
Zaslav stated that Paramount has been repeatedly informed of weaknesses in its proposals and must now demonstrate whether it can present a superior and actionable offer. Netflix, for its part, has sharply criticized Paramount's bid, describing it as financially risky and raising concerns about its funding structure. The streaming company also pointed to potential regulatory scrutiny, citing foreign investment backing Paramount's proposal, including capital linked to Middle Eastern royal families.
Shareholder Vote and Future Implications
WBD emphasized that its board has not concluded that Paramount's offer is superior to the Netflix merger. However, by reopening talks, the company is signaling it is willing to evaluate whether a higher bid could emerge. The situation continues to unfold, with shareholders set to vote on the Netflix transaction at a special meeting scheduled for March 20. This decision will significantly impact the future landscape of the media and streaming industries.
