The Paramount logo is displayed on the water tower at Paramount Studios on December 8, 2025 in Los Angeles, California.
Mario Tama | Getty Images
THE Discovery of Warner Bros. The board of directors said Wednesday that it unanimously recommended that WBD shareholders reject a takeover bid from Paramount Skydance and stick to a “superior” proposition of Netflix.
Last week, Paramount launched a hostile bid for WBD, offering an all-cash offer of $30 per share directly to shareholders. Paramount Skydance CEO David Ellison argued that the deal, which equates to an enterprise value of $108.4 billion, is better than Netflix’s and that a Paramount-WBD combination would have a better chance of gaining regulatory approval.
“After careful evaluation of Paramount’s recently initiated tender offer, the board of directors has concluded that the value of the offer is insufficient, with significant risks and costs imposed on our shareholders,” said Samuel Di Piazza, chairman of the board of directors of Warner Bros. Discovery, in a press release.
“This offer once again fails to address key concerns that we have consistently communicated to Paramount throughout our extensive engagement and review of their six previous proposals,” Di Piazza said. “We are confident that our merger with Netflix represents greater and more certain value for our shareholders and we look forward to realizing the compelling benefits of our combination.”
The WBD board noted that Paramount’s offer includes more than $40 billion in financing separate from that of the Ellison family, although Paramount says the financing benefits from a “full safety net” from the family. On Tuesday, Jared Kushner’s Affinity Partners withdrew from the offering, which also includes about $24 billion from Gulf state sovereign wealth funds.
“Despite its own resources, as well as multiple assurances from PSKY during our strategic review process that such a commitment was imminent, the Ellison family chose not to support PSKY’s offer,” the board said in a letter to shareholders.
Di Piazza told CNBC’s David Faber on “Squawk Box” Wednesday morning that the board would have appreciated greater involvement from Ellison’s father, billionaire Oracle co-founder Larry Ellison.
“We weren’t sure that one of the richest people in the world would be there at the closing,” Di Piazza said. “Making a deal is good, making a deal is better.”
Netflix proposed a cash and stock deal for WBD’s streaming and studio assets, which have a net worth of $72 billion or an enterprise value of about $83 billion, including debt. As part of the deal, Warner Bros.’ portfolio of cable networks. Discovery would be split into a separate entity.
“Netflix made an attractive offer — it was cash heavy, with certainty of closing, high termination fees, and they addressed the operational issues we were concerned about,” Di Piazza told CNBC. “PSKY had every opportunity to tackle this wide range of issues, but they chose not to.”
WBD noted that Netflix’s offer “did not require any equity financing or strong debt commitments,” given Netflix’s market valuation of more than $400 million.
“It wasn’t a difficult choice,” Di Piazza told CNBC.
He also dismissed antitrust questions surrounding both proposals: “Either of these deals can be done. These two transactions will have to work their way through the process. [Department of Justice]”.
Di Piazza said the company would hold a shareholder vote in the spring or early summer, although he said the date has not been set.
Mario Gabelli, CEO of GAMCO Investors and a WBD shareholder, told CNBC’s Becky Quick on Wednesday that while he was previously leaning toward Paramount’s offer, “the most important thing is to keep it in play,” hoping for more trading from both bidders.
Netflix said Wednesday it “welcomes” the Warner Bros. board’s recommendation. Discovery.
“This is a competitive process that has delivered the best results for consumers, creators, shareholders and the entire entertainment industry,” Netflix co-CEO Ted Sarandos said in a statement. “Netflix and Warner Bros. complement each other, and we are excited to combine forces with their theatrical division, world-class television studio and the iconic HBO brand, which will continue its focus on prestige television.”
Netflix co-CEO Greg Peters told CNBC on Wednesday that the board’s recommendation sent “a pretty clear message.”
“Our deal structure is clear, that’s for sure, we’re a scale company… we have a strong investment-grade balance sheet,” Peters told “Squawk Box.”
He also dismissed antitrust questions, saying that U.S. television’s audience share is still competitive and that audiences for streaming services Netflix and HBO Max are complementary.
Peters said that if regulators were to take Netflix to court, the company would fight to get the deal: “We have some good arguments, and we think we should make those arguments and make them forcefully.”