A Bidding War Erupts for Warner Bros. Discovery

The future ownership of media giant Warner Bros. Discovery (WBD) hangs in the balance, caught in a dramatic corporate tug-of-war. Two major suitors, streaming leader Netflix and rival Paramount Skydance, are locked in an intense battle for control, creating significant uncertainty for shareholders.

Challenging the established narrative, Paramount Skydance has launched a formidable counter-offer. The company proposes to acquire the entirety of Warner Bros. Discovery for $30 per share in cash, a figure that numerically exceeds competing proposals. Despite this premium, the WBD board unanimously rejected the bid on January 7, 2026. Directors concluded the offer was not in shareholders' best interests and failed to qualify as a "superior proposal" to the existing arrangement.

Undeterred, Paramount escalated its campaign on January 12. The conglomerate announced its intention to nominate its own slate of candidates for the WBD board of directors. This strategic move aims to seize control at the upcoming 2026 Annual General Meeting, thereby blocking approval for the competing transaction.

Netflix's Revised Cash-and-Split Strategy

On the other side of the contest, Netflix has solidified its position. Warner Bros. Discovery and Netflix announced a crucial amendment to their merger agreement on January 20, 2026. The deal was transformed into a pure cash transaction, valuing WBD at $27.75 per share. Company statements indicate this shift is designed to provide greater certainty for investors.

Should investors sell immediately? Or is it worth buying Warner Bros. Discovery (A)?

A key component of this revised plan involves a complex corporate separation. Specific assets, including the company's cable networks, are slated to be spun off into a new entity named "Discovery Global." This new company would subsequently be distributed to existing WBD shareholders. Management has already filed a preliminary proxy statement with U.S. regulators, paving the way for a shareholder vote scheduled for April 2026.

Market Skepticism Weighs on Share Price

The escalating takeover fight is being viewed with caution by the market. Despite the substantial cash offers on the table, WBD shares currently trade at €22.81, a price significantly below the proposed acquisition values. This represents a decline of nearly 22% from the 52-week high of €29.23, reflecting deep investor doubts about either transaction concluding smoothly.

The situation is entering a critical phase. With the board-sponsored shareholder vote set for April 2026 and ongoing regulatory reviews in the United States and United Kingdom, the landscape remains highly fluid. Whether Paramount's higher cash bid or the board-endorsed strategic path with Netflix will prevail is set to be determined in the coming weeks.