Warner Bros. Discovery has reopened acquisition talks with Paramount Skydance, granting the media company a seven-day window to present a counteroffer to Netflix’s existing $82.7 billion bid, the company announced Tuesday.
The move comes after Netflix offered Warner Bros. Discovery a waiver allowing it to engage with Paramount Skydance, according to a statement from Warner Bros. Discovery. The discussions, which began Tuesday, are scheduled to conclude on February 23, at which point Paramount Skydance is expected to submit its “best and final offer.”
Paramount Skydance is seeking to acquire all of Warner Bros. Discovery for $108.4 billion, a figure that significantly exceeds Netflix’s offer, which is focused on acquiring Warner Bros. Discovery’s studio and streaming assets. Under the Netflix deal, Warner Bros. Discovery’s television properties, including CNN, TBS and TNT, would be spun off into a separate, publicly traded company called Discovery Global.
Despite the renewed talks with Paramount Skydance, Warner Bros. Discovery’s board continues to recommend shareholders approve the Netflix deal, with a special shareholders meeting scheduled for March 20 to vote on the proposed merger. “Every step of the way, we have provided [Paramount Skydance] with clear direction on the deficiencies in their offers and opportunities to address them,” Warner Bros. Discovery CEO David Zaslav said in a statement. “We are engaging with [Paramount Skydance] now to determine whether they can deliver an actionable, binding proposal that provides superior value and certainty for WBD shareholders through their best and final offer.”
Netflix expressed confidence that its offer “provides superior value and certainty,” but acknowledged the disruption caused by Paramount Skydance’s pursuit. The streaming giant characterized the waiver as a means to “finally resolve this matter.”
Paramount Skydance has argued its bid is financially superior and more likely to gain regulatory approval from U.S. And European antitrust authorities. The company has offered to pay Warner Bros. Discovery shareholders a “ticking fee” of 25 cents per share – approximately $650 million per quarter – for each quarter the deal remains unclosed beyond December 31, 2026. Paramount Skydance has also pledged to cover the $2.8 billion termination fee Warner Bros. Discovery would owe if it terminates its agreement with Netflix.
Financing for Paramount Skydance’s offer is secured through $43.6 billion in equity commitments from Larry Ellison and RedBird Capital Partners, alongside $54 billion in debt financing from Bank of America, Citigroup, and Apollo Global Management.
Concerns have been raised that a Netflix acquisition of Warner Bros. Discovery could concentrate too much power in the streaming giant’s hands, particularly given Netflix’s limited commitment to theatrical releases. Netflix has responded by committing to a 45-day theatrical window for Warner Bros. Films should the acquisition proceed.
A successful acquisition by Paramount Skydance would place CNN under the control of the Ellison family, raising questions about potential editorial influence. David Ellison’s recent takeover of CBS, part of the Paramount empire, has been accompanied by editorial changes widely perceived as favoring conservative viewpoints. Larry Ellison is also a significant investor in TikTok’s U.S. Operations.
Shares of Warner Bros. Discovery rose more than 3 percent in Tuesday trading, even as Paramount Skydance climbed over 5 percent. Netflix’s stock saw a slight increase.
