WBD Board Rejects Paramount’s $108 Billion Hostile Bid, Reaffirms Support for Netflix Merger

The high-stakes tug-of-war for one of Hollywood’s most storied studios reached a turning point today. The Board of Directors of Warner Bros. Discovery (WBD) has unanimously rejected a revised, $108.4 billion hostile takeover bid from Paramount Skydance, describing it as an “inferior” and risky leveraged buyout. Instead, the board reaffirmed its commitment to the existing $82.7 billion merger agreement with Netflix.

The rejection comes despite a massive personal guarantee from Oracle co-founder Larry Ellison, who had pledged $40.4 billion in equity financing to back his son David Ellison’s Paramount bid. In a letter to shareholders on Wednesday, January 7, 2026, WBD Chair Samuel Di Piazza Jr. argued that while Paramount’s headline price of $30 per share was higher, the deal was structurally unstable, saddled with “extraordinary debt,” and lacked the regulatory certainty of the Netflix tie-up.

For Netflix, this victory marks a seismic shift in strategy—moving from its historical “builder, not buyer” philosophy to an acquisition-led growth phase. Under the terms of the deal, Netflix will acquire WBD’s powerhouse studio and streaming assets, including HBO, Max, and the DC Universe. Meanwhile, WBD’s linear assets—CNN, TNT, and Discovery—are slated to be spun off into a separate entity, “Discovery Global,” by Q3 2026.

Industry analysts suggest that a Netflix-Warner entity could control over 35% of the U.S. streaming market, dwarfing competitors like Disney+ and Amazon Prime. However, the path ahead remains a “long, bumpy regulatory road.” With the U.S. Department of Justice already signaling intense scrutiny, both companies have prepared massive $5.8 billion break-up fees—among the largest in corporate history—to signal their confidence in clearing antitrust hurdles.

Summary

Warner Bros. Discovery has officially snubbed Paramount Skydance’s $108.4 billion hostile offer, choosing to stick with Netflix’s $82.7 billion cash-and-stock deal. The board cited the “historic” debt levels required for the Paramount bid as a primary risk. The move paves the way for Netflix to absorb HBO and the Warner film studios, radically altering the streaming landscape.

Frequently Asked Questions (FAQs)

Q1: Why did WBD reject Paramount’s higher offer? 

The board deemed Paramount’s $108.4 billion bid a risky leveraged buyout that would saddle the combined company with excessive debt compared to the Netflix deal.

Q2: How much is Netflix paying for Warner Bros. Discovery? 

Netflix is acquiring WBD’s studio and streaming assets for $27.75 per share, totaling an enterprise value of $82.7 billion.

Q3: What happens to CNN and Discovery in the Netflix deal? 

These linear networks will be spun off into a new independent company called “Discovery Global,” expected in mid-2026.

Q4: Who is backing the Paramount bid for WBD? 

David Ellison’s Paramount Skydance bid was backed by an “irrevocable personal guarantee” from his father, Oracle founder Larry Ellison.