Photo Credit: Getty Images
Warner Bros. Discovery signaled Tuesday that Paramount Skydance's sweetened all-cash bid could outmatch Netflix's existing agreement, intensifying a takeover fight that could reshape Hollywood's balance of power.
Paramount raised its offer to $31 per share for the entirety of Warner Bros. Discovery, up from $30, and bolstered the proposal with a $7 billion termination fee if regulators block the transaction. The bidder also pledged $2.8 billion to help Warner exit its prior deal with Netflix.
To further entice shareholders, Paramount agreed to a "ticking fee" of 25 cents per share per quarter if the deal is not finalized by Sept. 30, adding pressure to close swiftly. The company also indicated it would contribute additional equity if financing concerns arise, addressing questions about funding reliability.
Warner's board said the revised proposal "could reasonably be expected" to surpass Netflix's $27.75-per-share offer for its studio and streaming assets, though directors have not formally declared it superior. Should the board back Paramount's bid, Netflix would have four business days to respond with an improved offer.
Whether Netflix counters. Co-CEO Ted Sarandos recently suggested the company would remain disciplined, warning it would not "overpay," while accusing Paramount of creating confusion among shareholders. A higher bid from Netflix would escalate an already heated contest.
Netflix struck an $83 billion agreement in December for Warner's film and television studios, catalog and HBO Max streaming platform. Soon after, Paramount launched a $108 billion hostile bid for the entire company, backed financially by billionaire Larry Ellison, father of Paramount Skydance CEO David Ellison.
Complicating matters, the suitors are pursuing different assets, Netflix seeks core entertainment divisions, while Paramount aims to acquire the whole enterprise. Warner also plans to spin off its television networks into a separate public company, Discovery Global, potentially altering shareholder returns.
With both buyers' shares sliding during the standoff, analysts question whether strategic logic, or executive pride, will determine the winner. Either outcome would hand control of iconic franchises and vast content libraries to a new steward, redrawing the competitive map of the entertainment industry.
