Warner Bros. Discovery rejects Paramount offer, doubles down on Netflix deal

Warner Bros. Discovery has advised shareholders to reject Paramount’s bid, backing its proposed Netflix deal instead

Warner Bros. Discovery has formally advised shareholders to reject Paramount’s hostile takeover bid, arguing that the offer presents significant financial and regulatory risks compared with the company’s proposed transaction with Netflix.

In a letter filed Wednesday, the board described Paramount’s $30-per-share tender offer as “illusory,” saying it fails to deliver sufficient value and relies on complex financing arrangements that could expose shareholders to uncertainty. The company said its existing plan to sell most of its film and television assets to Netflix offers greater clarity, fewer contingencies and a clearer path to regulatory approval.

Paramount executives have pushed back, insisting their bid provides more certainty and superior value. However, Warner Bros. Discovery raised concerns about the structure of Paramount’s financing, which includes backing from sovereign wealth funds linked to Saudi Arabia, Qatar and Abu Dhabi. While Paramount has stated that those investors would not receive voting rights or governance influence, the arrangement has drawn scrutiny from U.S. lawmakers citing potential national security implications.

The debate intensified this week after Affinity Partners, the private equity firm run by Jared Kushner, withdrew from Paramount’s financing group. The firm said it no longer plans to pursue the opportunity, even as it reiterated support for Paramount’s strategic rationale.

Despite Warner Bros. Discovery’s recommendation, the final decision rests with shareholders. Some investors have indicated they may still tender shares to Paramount before the current offer expires in early January, a deadline that could be extended if negotiations continue.

Meanwhile, Netflix is pressing forward with its agreement to acquire Warner Bros. Discovery’s studio and streaming assets following the company’s planned corporate split next year. Netflix executives have said the deal would protect jobs, preserve theatrical releases and strengthen competition in the global streaming market.

With political, regulatory and financial pressures mounting, analysts expect the battle for Warner Bros. Discovery’s future to continue well into 2026.