Revised offer aims to block Paramount takeover
Netflix has escalated its fight for Warner Bros. Discovery by agreeing to pay entirely in cash for Warner Bros. and HBO, abandoning its earlier mix of cash and stock. The revised proposal is designed to strengthen Netflix’s position against a hostile takeover bid from Paramount.
The updated plan was announced Tuesday morning, roughly six weeks after the companies first revealed a deal that would dramatically reshape the global entertainment industry.
Deal structure and valuation
Under the amended agreement, Netflix is offering $27.75 per share for Warner Bros. Discovery’s movie studio and streaming assets. Those assets will be spun off into a new publicly traded company named Warner Bros. later this year.
Warner Bros. Discovery’s cable networks, including CNN, will be placed into a separate entity called Discovery Global. Netflix said the transaction will be financed through a combination of cash on hand, existing credit facilities and committed financing.
Why Netflix changed its offer
Netflix’s earlier bid included stock, which allowed Paramount to argue that its competing all-cash proposal carried greater certainty for shareholders. By switching to an all-cash structure, Netflix aims to remove that argument and speed up the path toward a shareholder vote.
The companies said the revised offer provides clearer value for investors and simplifies regulatory and approval steps.
Paramount pushes back
Paramount has continued to pursue Warner Bros. Discovery aggressively, offering $30 per share and threatening a proxy battle to replace the WBD board. Paramount CEO David Ellison has argued that WBD’s television networks have little to no long-term equity value.
Earlier this month, Paramount filed a lawsuit in Delaware seeking more disclosure around WBD’s valuation. A judge declined to fast-track the case.
Next steps for shareholders
WBD CEO David Zaslav said the company plans to schedule a special shareholder meeting this spring, pending review by the U.S. Securities and Exchange Commission. The board has reiterated its support for the Netflix deal, arguing it offers both immediate value and long-term upside through Discovery Global.
Netflix is expected to report quarterly earnings after the market closes Tuesday, adding further focus to a week that could prove pivotal for the future of the media industry.
