Paramount Skydance has emerged as the frontrunner to acquire Warner Bros. Discovery after Netflix declined to increase its offer for the media and streaming major.
Netflix Declines to Match $31-a-Share Offer
The turning point came after Paramount Skydance submitted a revised $31-per-share bid for Warner Bros Discovery, topping Netflix’s earlier proposal of $27.75 per share for the studio and streaming assets. Following the announcement, Netflix shares surged 10 percent in extended trading, signaling investor approval of its decision to maintain financial discipline, Reuters news report said.
Netflix said it chose not to match the higher bid because the acquisition was no longer financially attractive at the revised valuation.
Netflix advisers recommended exiting the process, citing concerns that competing against billionaire Larry Ellison could lead to overpaying. Ellison, co-founder and executive chairman of Oracle, is backing Paramount Skydance’s aggressive push through the Ellison Trust.
Deal Structure and Financing Details
Paramount Skydance has strengthened its proposal with significant financial backing:
$45.7 billion in equity commitment, increased from $43.6 billion, supported by the Ellison Trust.
$57.5 billion in debt financing, up from $54 billion previously.
The financing is being arranged by Bank of America Merrill Lynch, Citigroup, and Apollo Global Management.
Paramount also raised the reverse termination fee to $7 billion, up from $5.8 billion, to strengthen its position should regulatory approvals fail.
Strategic Impact on Streaming and Media
A merger between Paramount Skydance and Warner Bros Discovery would reshape the global entertainment industry by combining:
Two major Hollywood studios
Two leading streaming platforms: HBO Max and Paramount+
Two major news brands: CNN and CBS
The consolidation would create a formidable competitor in the global streaming market, intensifying rivalry with Netflix and other digital platforms.
Regulatory and Political Scrutiny Looms
Despite the financial momentum, the proposed transaction faces significant regulatory hurdles in the United States and abroad. Lawmakers including Elizabeth Warren, Bernie Sanders, and Richard Blumenthal have expressed concerns that political connections could influence regulatory outcomes.
Shareholder Pressure and Next Steps
Activist investor Ancora Holdings, which holds a small stake in Warner Bros Discovery, has increased pressure on the company’s board, alleging insufficient engagement with Paramount Skydance during negotiations.
The Warner Bros board must now formally terminate its existing agreement with Netflix before adopting Paramount Skydance’s revised offer.
Market Outlook
The acquisition battle highlights the escalating competition in the global streaming and entertainment sector, where scale, content libraries, and capital strength are becoming critical advantages. If approved, the Paramount Skydance and Warner Bros Discovery merger could trigger further consolidation across Hollywood and reshape media investment strategies in 2026 and beyond.
BABURAJAN KIZHAKEDATH