Paramount tries to block Netflix-Warner deal with direct appeal to shareholders
Paramount has launched a hostile takeover attempt for Warner Bros Discovery, triggering a high-stakes clash with rival bidder Netflix over control of the company behind HBO, CNN and one of Hollywood’s most storied film studios. The outcome of the battle could significantly reshape the U.S. entertainment industry.
The move came just days after Warner’s top executives agreed to Netflix’s USD 72 billion offer. Paramount’s new proposal valued at USD 77.9 billion bypasses Warner management entirely and appeals directly to shareholders with a richer bid that includes the cable businesses Netflix wishes to exclude.
Paramount said the decision to go hostile followed multiple earlier proposals that Warner leadership was not meaningfully engaged with , despite Warner’s October announcement that it was open to a sale. In its appeal to shareholders, Paramount stressed that its bid includes USD 18 billion more in cash than Netflix’s and was argued to be more likely to pass scrutiny from President Donald Trump’s administration, a key factor given Trump’s history of intervening in major corporate decisions.
Over the weekend, Trump warned that a Netflix-Warner combination “could be a problem” because of its potential market share and said the deal was planned to be reviewed personally .
Netflix, however, insists its agreement will hold. The company said it is confident Warner will reject Paramount’s offer and that both regulators and Trump will ultimately support its deal. This confidence was attributed to multiple discussions co-CEO Ted Sarandos has reportedly held with Trump regarding the streaming giant’s expansion and hiring practices. Sarandos told investors on Monday that “the president’s interest in this was believed to be aligned with ours, which is to create and protect jobs.”
Political reactions intensify in Washington
The takeover battle has drawn swift political scrutiny from both Democrats and Republicans, who are expressing concerns about potential impacts on streaming prices, job stability in movie theatres, and the diversity of entertainment choices and political viewpoints.
Paramount CEO David Ellison said the company had submitted six proposals over a 12-week period. He stated that the Paramount offer “was believed to create a stronger Hollywood” and was in the best interests of creators, consumers and theatres. Ellison added that the deal was expected to increase industry competition and boost theatrical releases.
Regulatory filings released Monday also suggested a potential political advantage for Paramount: an investment firm run by Trump’s son-in-law Jared Kushner was indicated to be participating in the deal. Funds linked to the governments of three Persian Gulf nations widely reported as Saudi Arabia, Abu Dhabi and Qatar are also expected to take part.
Trump’s unpredictable role
Trump’s involvement remains uncertain. Known for making impulsive decisions, he attacked Paramount on Monday for allowing “60 Minutes” to air an interview with Rep. Marjorie Taylor Greene, whom he now opposes. He posted online that the company “was no better than the old ownership.”
The contest for Warner intensified last Friday when Netflix announced its agreement with Warner’s leadership to purchase the studio behind “Harry Potter,” HBO Max and DC Studios. Netflix’s offer, combining cash and stock, is valued at USD 27.75 per share, an enterprise value of USD 82.7 billion including debt. Paramount’s hostile offer, by comparison, stands at USD 30 per share and USD 108 billion including assumed debt. The bid expires January 8 unless extended.
Comparison of the two proposals remains complex because Netflix is attempting to buy only certain assets. Its offer will close only after Warner completes its planned spinoff of its cable division assets that Paramount intends to buy outright.