According to Engadget, Paramount Global has launched a hostile, all-cash tender offer to acquire all of Warner Bros. Discovery for $30 per share, a bid that expires on January 8 and totals a massive $108.4 billion. This comes just days after the WBD board unanimously accepted a competing offer from Netflix, valued at $82.7 billion, which breaks down to $23.25 per share in cash and $4.50 in Netflix stock. Paramount’s bid is notably for the entire WBD company, while Netflix’s deal is only for the Streaming and Studios division, which includes HBO Max and the Warner Bros. film and TV studios, set to split off next year. Paramount, which was itself bought by Skydance for $8 billion this year, is financing its offer with backing from the Ellison family, RedBird Capital, and a whopping $54 billion in debt commitments from Bank of America, Citi, and Apollo. In a public statement, Paramount sharply criticized the WBD board’s recommendation of the Netflix deal, calling the valuation of the leftover cable networks “illusory.”
The debt dump and the hostile pitch
Here’s the thing that makes this so messy: debt. A lot of it. As of the end of September, WBD was carrying $34.5 billion in gross debt. The plan with the Netflix deal was to spin off the cable networks (dubbed Discovery Global) and saddle that new company with most of that debt burden. Paramount is basically calling that plan a shell game, arguing in its press release that the value placed on those networks is “unsupported by the business fundamentals.” So Paramount’s hostile move, going directly to shareholders, is a bet that those shareholders would rather have $30 in cash now than a mix of cash, Netflix stock, and shares in a highly leveraged, declining cable business.
And they’re not being subtle about their tactics. Paramount sent a letter to WBD CEO David Zaslav questioning the “fairness” of the sale process, claiming it submitted six proposals over 12 weeks that were ignored. The message to shareholders is clear: your board isn’t working for you.
The regulatory wild card
Now, Paramount is playing another interesting card: regulation. They’re arguing that their all-in-one acquisition would face less regulatory scrutiny than Netflix’s carve-up. Why? Two reasons. First, Paramount is a smaller company than Netflix, so the market concentration issue might look different to antitrust officials. Second, and this is the juicy part, they’re reportedly banking on a “cozy relationship with the Trump administration” to smooth the path. That’s not just speculation—over the weekend, President Trump himself commented on the Netflix deal, saying, “it is a big market share. It could be a problem.” That’s a huge signal to the market and arguably a direct shot across Netflix’s bow.
So we’ve got a brutal corporate brawl shaping up. On one side, a board-approved deal with a streaming titan that wants the shiny content assets. On the other, a hostile, all-cash offer from a recently acquired rival that says it’s saving shareholders from a debt-laden fate. The January 8 deadline for Paramount’s tender offer is going to create a frenzy. Will shareholders take the cash and run, or trust the board’s Netflix plan? Honestly, I think the sheer size of that cash premium is going to be incredibly hard to ignore, no matter what the board says. Buckle up.
