Paramount Intensifies Bid for Warner Bros. Discovery, Pressuring Netflix

The competitive landscape for major media assets is heating up, placing streaming leader Netflix in an increasingly defensive position. Paramount Skydance has significantly sweetened its unsolicited bid to acquire Warner Bros. Discovery (WBD), presenting new financial guarantees. This aggressive move coincides with a deepening regulatory review by the U.S. Department of Justice (DOJ) into Netflix's own $82.7 billion offer for the same company.

On Tuesday, Paramount Skydance revised its hostile takeover proposal to make it more compelling for WBD shareholders. While the cash offer of $30 per share remains unchanged, the challenger introduced key new clauses. A central feature is a "ticking fee" provision: should regulatory approval extend beyond December 31, 2026, Paramount would pay an additional 25 cents per share for each subsequent quarter. This quarterly payment carries an approximate present value of $650 million.

To further mitigate risk for WBD, Paramount has committed to covering the $2.8 billion break-up fee payable to Netflix if the deal collapses. The bidder would also assume potential refinancing costs estimated at $1.5 billion. According to company statements, the offer is fully financed through equity from the Ellison family and committed debt financing from major banks, including Bank of America.

Should investors sell immediately? Or is it worth buying Netflix?

Regulatory Scrutiny Complicates Netflix's Timeline

Netflix faces its own challenges as the DOJ examines its proposed acquisition. Reports from the Wall Street Journal indicate the investigation extends beyond standard procedure, with civil subpoenas being used to specifically search for evidence of anti-competitive behavior. Netflix representatives have characterized the process as a "completely normal business proceeding," stating the company is cooperating constructively with authorities.

WBD Board Maintains Current Stance

The Warner Bros. Discovery board of directors confirmed receipt of the new Paramount offer but has, for now, reiterated its recommendation for the Netflix agreement. Netflix had previously adjusted its own bid in January to $27.75 per share in cash. Meanwhile, market volatility has created opportunities for retail investors. After falling to a 52-week low of $79.23, Netflix shares have recently recovered to trade around $83.50.

The final decision now rests at the intersection of shareholder value and regulatory approval. Paramount's improved financial terms increase the pressure, while the timeline for Netflix's deal is closely tied to WBD's planned spin-off of its linear TV networks, scheduled for the third quarter of 2026.