Paramount crashes the Netflix party. Late last night, Paramount Skydance launched a hostile all cash tender offer for all of Warner Bros. Discovery at 30 dollars a share. That values WBD at about 108.4 billion dollars, enterprise value. It is a direct swing at Netflix, which only days ago agreed to buy WBD’s studio and streaming assets. The fight for Hollywood’s crown is now open, public, and very expensive.
What Paramount put on the table
Paramount’s offer covers everything. Studios, Max and Discovery+, cable networks like TNT and TBS, and news, including CNN. It is a full takeout, paid in cash. Paramount says it has 54 billion dollars in committed debt financing from Bank of America, Citigroup, and Apollo. The Ellison family, RedBird, and several sovereign investors are backing the equity. That is a lot of firepower, and it signals intent to close.
The price beats the Netflix pact by a wide margin. Netflix targeted only streaming and studios. That narrower deal, at roughly 82.7 billion dollars in enterprise value, carved out cable networks to be spun off later. Paramount is offering more money for more assets, now.
WBD’s board told me it will review the hostile bid under its agreement with Netflix. It plans to give shareholders a recommendation within ten business days. For now, it asked investors not to act on the tender. That pause sets the stage for a tense auction window.
Watch the cash. Confirmed financing, escrowed funds, and the treatment of debt will decide which bid is real or risky.
Market reaction and the investor math
Stocks moved fast. WBD jumped on the open, then settled as arbitrage funds weighed deal risk. Paramount rose on the signal of bold synergies, then faced questions on leverage. Netflix slipped, as investors priced in a real chance it loses the prize, or pays more.
Here is the spread that matters. Paramount is offering 30 dollars a share in cash. If WBD trades several dollars below that, the market is discounting closing risk, timing, and the chance of a higher bid. That gap is the risk premium. It will move with every regulatory hint, board statement, and financing update.
For Netflix holders, the risk is twofold. No assets, if it gets outbid. Or a richer price, which could pressure returns and balance sheet flexibility. For Paramount holders, the key question is debt. Pro forma leverage, interest costs, and synergy credibility will drive the stock path from here.
The regulatory wall everyone must climb
A combined Paramount and WBD would sit atop studios, streaming, cable, sports, and news. It links CBS broadcast rights with WBD’s vast library and channels. That draws a bright line for the Department of Justice. It also invites communications regulators to review distribution and carriage issues.
Netflix faces its own checks, but its deal carves out the cable bundle, which lowers overlap. Paramount wants the whole stack. That gives it scale benefits, but also the hardest antitrust test. Political heat is already high. Expect hearings, letters, and loud public debate on media power and news influence.
A hostile tender can win the headline, then lose in court. Antitrust risk is real, and clocks can run out.
Scenarios and what they mean for investors
- WBD rejects Paramount, moves ahead with Netflix. Netflix stock relief, WBD trades to the Netflix terms, cable spin plays in focus.
- WBD engages, triggers a formal auction. Higher price possible, all stocks volatile, breakup fees and timing risk rise.
- Paramount raises its bid, improves terms. WBD pops, Netflix falls, Paramount tested on leverage and synergy delivery.
- Regulators stall or block both paths. WBD slips, balance sheet repair and asset sales reenter the plan.
Paramount previously boosted a proposed breakup fee to 5 billion dollars in talks, a show of confidence. Expect both sides to sharpen protections and penalties in any revised agreement.
Economic ripple effects
This fight could reshape content economics. A Paramount WBD combo would increase bargaining power with advertisers and distributors. That could lift ad pricing and carriage fees, which helps cash flow. It could also pressure suppliers and smaller rivals. If Netflix wins, it locks up premium franchises, from DC to HBO originals, and changes streaming competition again. Either way, the industry moves toward fewer, bigger players with stronger libraries and global reach.
Debt costs matter too. A higher rate world punishes leverage. Every extra turn of debt trims the value of synergies and tax shields. Investors will price that daily.
Frequently Asked Questions
Q: What happens next for WBD shareholders?
A: The board will issue a recommendation within ten business days. Until then, it asked investors not to tender their shares.
Q: How is Paramount funding the bid?
A: With 54 billion dollars of committed debt and large equity backing from long term investors, led by the Ellison family.
Q: What about Netflix’s agreement?
A: It covers studios and streaming. It excludes cable networks. It remains in place while WBD evaluates the hostile bid.
Q: Which deal is more likely to clear regulators?
A: Netflix has the cleaner path because overlap is smaller. Paramount offers more value, but faces tougher antitrust review.
Q: When could this close?
A: Best case, the board picks a path this month. Formal reviews could run into late 2026, or longer if litigation starts.
Conclusion
Paramount just turned a sale into a showdown. The cash is bigger, the scope is broader, and the risks are higher. The WBD board holds the keys, regulators hold the clock, and markets will price every twist in real time. For investors, sizing position risk and patience now matters more than calling the winner.
