Warner Bros Discovery has urged shareholders to reject a $108.4 billion takeover proposal from Paramount Skydance, backing instead its recently agreed deal with Netflix.
Paramount Skydance had described its offer as superior to the $72 billion agreement Warner Bros Discovery struck with Netflix for its film and streaming assets. However, in a decisive move, the Warner Bros board said it had unanimously concluded that the Netflix deal offers greater certainty and long-term value.
The media group put itself up for sale in October after receiving multiple expressions of interest, including approaches from Paramount Skydance. On 5 December, it formally agreed to sell its movie studio and streaming operations, including HBO, to Netflix.
In a detailed filing to shareholders, Warner Bros Discovery said the Paramount proposal carried “numerous and significant risks,” and rejected claims that the bid is securely financed by the Ellison family, which is backing Paramount Skydance. The board noted that Netflix’s offer is well funded, clearer in structure and carries lower regulatory risk.
Netflix welcomed the board’s recommendation. Co-chief executive Ted Sarandos said the merger agreement was “superior” and in the best interests of shareholders, adding that the company’s financing and regulatory pathway were more straightforward.
Key differences separate the two bids. Netflix is seeking Warner Bros’ film studio, HBO streaming service and vast content library, but not its traditional television networks. That would require Warner Bros Discovery to spin off channels such as CNN and TNT into a separate entity before the transaction is completed.
Paramount Skydance, by contrast, wants to acquire Warner Bros Discovery in its entirety, including its television networks. Such a deal would combine competing channels under one roof, raising concerns about reduced competition and consumer choice as consolidation accelerates in the entertainment industry.
Despite the board’s stance, Paramount Skydance could still return with a revised offer, suggesting the battle for control of the Hollywood studio is far from over. Any takeover is expected to face intense scrutiny from competition regulators in the United States and Europe.
A successful bidder would gain a major advantage in the streaming wars, securing one of the industry’s deepest libraries, including franchises such as Harry Potter, Friends, the MonsterVerse and HBO’s premium content.
Analysts say the saga could take months to resolve. Mike Proulx of research firm Forrester likened the situation to a high-stakes drama, noting that the outcome remains uncertain.
The proposed mergers have also drawn criticism from industry groups. The Writers Guild of America has called for any deal to be blocked, warning that further consolidation could lead to job losses, lower wages and reduced content choices for audiences.
