Warner Bros. Officially Rejects Paramount's Takeover Bid, Urges Shareholders to Approve Netflix Deal

Warner Bros. Discovery has told its shareholders they should cull Paramount Skydance's $108.4 cardinal takeover bid for the company, urging them to o.k. the Netflix woody instead.

A station connected Warner Bros. fiscal website confirmed that its Board of Directors had decided that Paramount’s bid “is not successful the champion interests of WBD and its shareholders and does not conscionable the criteria of a ‘Superior Proposal’ nether the presumption of WBD's merger statement with Netflix announced connected December 5, 2025.”

Explaining why, Warner Bros. deed retired astatine Paramount, accusing it of consistently misleading its shareholders by saying its bid had a "full backstop" from the Ellison family. "It does not, and ne'er has," Warner Bros. said.

"PSKY's astir caller connection includes a $40.65 cardinal equity commitment, for which determination is nary Ellison household committedness of immoderate kind," Warner Bros. continued. "Instead, they suggest that you trust connected an chartless and opaque revocable spot for the certainty of this important woody funding. Despite having been told repeatedly by WBD however important a afloat and unconditional financing committedness from the Ellison household was – and contempt their ain ample resources, arsenic good arsenic aggregate assurances by PSKY during our strategical reappraisal process that specified a committedness was forthcoming – the Ellison household has chosen not to backstop the PSKY offer.

"And a revocable spot is nary replacement for a secured committedness by a controlling stockholder. The assets and liabilities of the spot are not publically disclosed and are taxable to change. As the sanction indicates, revocable trusts typically person provisions allowing for assets to beryllium moved astatine immoderate time. And the documents provided by PSKY for this conditional committedness incorporate gaps, loopholes and limitations that enactment you, our shareholders, and our institution astatine risk."

Earlier this week, the backstage equity steadfast owned by Donald Trump’s son-in-law, Jared Kushner, pulled its backing for Paramount’s hostile takeover bid, leaving it with the backing of wealthiness funds tally by 3 governments successful the Persian Gulf, wide reported arsenic Saudi Arabia, Abu Dhabi, and Qatar.

Netflix, arsenic you’d expect, welcomed the decision. “The Warner Bros. Discovery Board reinforced that Netflix's merger statement is superior and that our acquisition is successful the champion involvement of stockholders," said Ted Sarandos, Netflix co-CEO.

"This was a competitory process that delivered the champion result for consumers, creators, stockholders and the broader amusement industry. Netflix and Warner Bros. complement each other, and we're excited to harvester our strengths with their theatrical movie division, world-class tv studio, and the iconic HBO brand, which volition proceed to absorption connected prestige television. We're besides afloat committed to releasing Warner Bros. films successful theaters, with a accepted window, truthful audiences everyplace tin bask them connected the large screen."

Paramount launched its hostile takeover bid for Warner Bros. Discovery soon aft Netflix emerged arsenic the victor of a lengthy bidding warfare with an $82.7 cardinal deal.

"WBD shareholders merit an accidental to see our superior all-cash connection for their shares successful the full company," Paramount brag David Ellison said successful a connection announcing his company's hostile bid. "Our nationalist offer, which is connected the aforesaid presumption we provided to the Warner Bros. Discovery Board of Directors successful private, provides superior value, and a much definite and quicker way to completion.

"We judge the WBD Board of Directors is pursuing an inferior connection which exposes shareholders to a premix of currency and stock, an uncertain aboriginal trading worth of the Global Networks linear cablegram concern and a challenging regulatory support process. We are taking our connection straight to shareholders to springiness them the accidental to enactment successful their ain champion interests and maximize the worth of their shares.”

The hostile takeover has present failed, however, leaving Netflix with a way towards completing the buyout. However, Netflix’s connection has sparked a pugnacious effect from immoderate members of Congress, and it is expected to look important scrutiny nether antitrust laws. Meanwhile, astatine slightest 1 HBO Max subscriber has already sued Netflix, claiming the woody threatens to trim contention successful the U.S. subscription video-on-demand market.

Warner Bros.-owned streaming level HBO Max includes everything from Game of Thrones to Harry Potter, James Gunn's DC Universe to Barbie, and its contented is expected to beryllium added to Netflix if and erstwhile the woody goes through.

After its announcement, Netflix sent subscribers an email of reassurance amid interest implicit imaginable terms rises. The email — reviewed by IGN — promised subscribers that thing was changing “today,” and confirmed that HBO Max and Netflix would proceed to run separately until the woody closes. It did not regularisation retired aboriginal terms rises, but did committedness that existent rank plans would stay successful spot astatine slightest until the woody goes through. As for erstwhile that volition be, Netflix said it expects to adjacent the transaction successful 12-18 months — so, astatine the earliest December 2026, but it could beryllium arsenic precocious arsenic summertime 2027.

In an capitalist telephone attended by IGN, Netflix main Ted Sarandos struck a assured code erstwhile asked astir the deal’s accidental of success. "We're highly assured successful the regulatory process," helium said. "This woody is pro-consumer, pro-innovation, pro-worker, it's pro-creator, it's pro-growth.”

As portion of the aforesaid call, Sarandos said Netflix would proceed to merchandise Warner Bros. movies successful theaters for now, though expected theatrical merchandise windows to shorten implicit clip to go "more idiosyncratic friendly."

One study has claimed Netflix is peculiarly keen to get Warner Bros.' immense contented room arsenic the streamer ramps up its imaginable to connection AI-generation tools and contented successful the future.

Photo by Anna Barclay/Getty Images.

Wesley is Director, News astatine IGN. Find him connected Twitter astatine @wyp100. You tin scope Wesley astatine [email protected] oregon confidentially astatine [email protected].