The latest move
Warner Bros. Discovery (WBD) is expected to reject a revised $108.4 billion hostile takeover proposal from Paramount Skydance, according to a CNBC report cited by Reuters on December 30, 2025.
The revised approach sought to address a core weakness of earlier outreach: financing certainty. Reuters reported the Paramount Skydance offer added a personal equity-financing guarantee from billionaire Larry Ellison, increased the reverse termination fee tied to regulatory risk, and extended the tender deadline—while keeping the headline $30-per-share all-cash value unchanged.
The competing alternative: Netflix’s bid
WBD has shown more interest in a rival proposal from Netflix, even though it is lower in overall value, because it is viewed as more secure and lower-execution-risk, Reuters reported.
Reuters’ earlier deal report said Netflix agreed on December 5, 2025 to buy WBD’s studios and streaming division in a cash-and-stock transaction that values WBD at about $72 billion in equity (about $82.7 billion including debt).
Under that structure, each WBD shareholder would receive $23.25 in cash and roughly $4.50 in Netflix stock per WBD share, per Reuters.
Why WBD may prefer “certainty” over “price”
The Paramount Skydance bid is larger on paper, but WBD’s board has focused on whether the offer can close cleanly and on time.
Reuters previously reported that WBD’s board had already rejected Paramount Skydance’s hostile bid, citing inadequate financing assurances.
The revised offer attempts to remedy that concern via Ellison’s guarantee and a higher reverse break fee, but the board is still expected to stick with the Netflix path, where financing and deal terms are viewed as more dependable.
There is also a contractual reality: Reuters reported the Netflix agreement includes a $2.8 billion breakup fee if WBD abandons the deal, making it more expensive to pivot unless Paramount materially improves terms or can demonstrate higher certainty.
Regulatory and political scrutiny is part of the math
Both transactions carry political and antitrust risk, but in different ways.
Reuters noted that Netflix’s proposed acquisition drew immediate antitrust and political pushback, with some U.S. lawmakers calling it an “antitrust nightmare,” underscoring the likelihood of a tough review environment.
Paramount Skydance has argued its combination would face fewer regulatory hurdles than a Netflix tie-up, a claim Reuters included in its reporting on the hostile approach.
What this means for the media sector in 2026
This contest has become a high-visibility test case for how investors price deal risk in legacy media:
Valuation comps: A higher nominal bid does not automatically win if financing, break-fee exposure, and regulatory timelines look fragile.
Strategic direction: The Netflix proposal spotlights a thesis that scale in studios and streaming can be consolidated under a digital-first buyer, while Paramount Skydance’s pitch is a broader “traditional media + streaming” consolidation play.
Credit and leverage sensitivity: Both scenarios put the spotlight on debt assumptions and the path to de-leveraging—critical in a sector still adjusting to streaming economics.
What to watch next
Tender deadlines and board actions
Paramount Skydance has extended deadlines and appealed directly to shareholders, but the key signal will be whether WBD’s board maintains its recommendation against the hostile offer as expected.
Break-fee dynamics
Any increase in bid value or changes in structure will be assessed against the Netflix breakup fee and the relative certainty of closing.
Regulatory messaging
Public statements from policymakers and regulators—especially in the U.S. and Europe—could shift perceived probability-of-close for either transaction.