The Paramount logo is displayed on the water tower at Paramount Studios on December 8, 2025 in Los Angeles, California.
Mario Tama | fake images
He Warner Bros. Discovery The board of directors said Wednesday that it unanimously recommended that WBD shareholders reject a takeover offer from supreme skydance and continue with a “superior” proposal of netflix.
Last week, Paramount launched a hostile bid for WBD, taking a cash offer of $30 per share directly to shareholders. Paramount Skydance CEO David Ellison has argued that the deal, which equates to an enterprise value of $108.4 billion, is better than Netflix's and that a combination of Paramount and WBD would have a better chance of winning regulatory approval.
“After careful evaluation of Paramount's recently launched public offering, the board concluded that the value of the offering is inadequate, with significant risks and costs imposed on our shareholders,” Samuel Di Piazza, chairman of the board of directors of Warner Bros. Discovery, said in a press release.
“This offer once again does not address the key concerns 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 superior and more secure value for our shareholders and we look forward to delivering the attractive benefits of our combination.”
The WBD board noted that Paramount's offer includes more than $40 billion of independent financing from the Ellison family, even though Paramount claims the financing has “full backing” from the family. On Tuesday, Jared Kushner's Affinity Partners abandoned its participation in the offering, which also includes about $24 billion from Gulf states' sovereign wealth funds.
“Despite its extensive own resources, as well as multiple assurances from PSKY during our strategic review process that such a commitment was forthcoming, the Ellison family has decided not to support PSKY's bid,” 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 present at the closing,” Di Piazza said. “Closing a deal is great, closing a deal is better.”
Netflix has proposed a cash and stock transaction for WBD's studio and streaming assets, with an equity value of $72 billion or an enterprise value of approximately $83 billion, including debt. Under that deal, Warner Bros. Discovery's cable network portfolio would be spun off into a separate entity.
“Netflix made a compelling offer: they had plenty of cash, certainty of closing, a high cancellation fee, and they responded to the operational issues we were concerned about,” Di Piazza told CNBC. “PSKY had every opportunity to address that broad range of issues and chose not to.”
WBD noted that Netflix's offer “did not require 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 the antitrust issues surrounding both proposals: “Either of these deals can be done. Both deals will have to work their way through negotiations.” [Department of Justice]”.
Di Piazza said the company will hold a shareholder vote in spring or early summer, although he said no date has 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 bid, “the most important part is keeping it in play,” expecting more back-and-forth from both bidders.
Netflix said Wednesday that it “welcomes” the recommendation from Warner Bros. Discovery's board of directors.
“This was a competitive process that delivered the best outcome for consumers, creators, shareholders and the entertainment industry as a whole,” Netflix co-CEO Ted Sarandos said in a statement. “Netflix and Warner Bros. complement each other and we are excited to combine our strengths with their film division, their world-class television studio and the iconic HBO brand, which will continue to focus on prestige television.”
Netflix co-CEO Greg Peters told CNBC on Wednesday that the board's recommendation sends “a pretty clear message.”
“Our deal structure is clean, it's safe, we're a scaled company…we have a strong investment-grade balance sheet,” Peters told “Squawk Box.”
Similarly, he dismissed antitrust questions, saying that television audience share in the United States remains competitive and that audiences for streaming services Netflix and HBO Max are complementary.
Peters said that if regulators took Netflix to court, he would fight for the deal: “We have a good case, and we think we should defend that case and present it strongly.”
