Paramount Sues Warner Bros Discovery, Targets Netflix Deal

Paramount Skydance Media, owned by CEO and chairman David Ellison, is taking legal action against Warner Bros Discovery (WBD) to seek more clarity on Netflix’s offer to acquire Warner Bros’ streaming and studios business. Paramount aims to nominate a set of directors for election to the WBD board who would potentially vote against the deal with Netflix. The nomination process will take place during the advance notice period for WBD’s 2026 annual meeting, opening in three weeks.

In response to Paramount’s lawsuit, WBD labelled it as “meritless,” stating that Paramount has not addressed the deficiencies of its offer. WBD has repeatedly rejected Paramount’s bids in favor of Netflix’s offer due to concerns about Paramount’s financial capability and dependence on borrowing money. Paramount is seeking ways to ensure shareholder approval for any separation of Global Networks from WBD.

Paramount’s $30 per share all-cash offer to acquire WBD has faced resistance from WBD, who has not provided a clear explanation for choosing Netflix’s offer over Paramount’s. Despite numerous attempts, WBD has not disclosed the financial details that would justify their decision to favor Netflix’s bid over Paramount’s.

Netflix has announced its acquisition of Warner Bros for $82.7 billion, which includes the film and television studios, HBO Max, and HBO, but not Discovery Global. Paramount remains adamant about its all-cash bid of $30 per share, directly appealing to shareholders in their pursuit of the company. Paramount remains committed to their tender offer, leaving the decision in the hands of shareholders.

Paramount is prepared to nominate directors for WBD’s board and propose an amendment to require shareholder approval for any separation of Global Networks. The company is determined to ensure that shareholders have a say in deciding which offer is best for them, emphasizing that their all-cash offer is financially superior to Netflix’s proposal.