Paramount raises offer to $31 and escalates Warner Bros bidding battle

Paramount Skydance has raised its takeover offer for Warner Bros. Discovery to $31 per share, putting its bid in direct contention with Netflix and prompting the Hollywood giant’s board to reopen talks that could reshape the media landscape. Warner Bros. Discovery said it was reviewing Paramount’s enhanced proposal, which includes a higher regulatory termination fee and other financial incentives, even as it continues to recommend the existing Netflix deal to shareholders.

Paramount’s new proposal increases its previous all-cash offer by $1 per share and includes a $7bn regulatory termination fee to reassure Warner’s board about regulatory risk. It also accelerates a “ticking fee,” compensating shareholders if the transaction does not close by a specified deadline, and covers costs that Warner Bros. Discovery would incur if it terminates its agreement with Netflix. The move raises the stakes in what has become a protracted bidding war between two of the entertainment industry’s most powerful players.

The offer comes after Warner Bros. Discovery’s board had earlier backed a $27.75-per-share deal with Netflix that would see the streaming giant acquire its studio and HBO operations. Paramount’s revised bid, by contrast, seeks to acquire the entire company, including its cable networks and news outlets, a broader package that analysts say could deliver higher overall value to shareholders if regulatory hurdles are cleared.

Warner Bros. Discovery’s willingness to engage further with Paramount underscores the complexity of assessing the rival bids, which differ significantly in structure and scope. If the board determines that Paramount’s offer constitutes a “superior proposal” under its agreement with Netflix, the streaming company would have four business days to improve its own terms or risk losing its position in the deal. Netflix has so far declined to comment publicly on Paramount’s latest proposal.

Paramount’s effort is led by David Ellison, whose company has returned to the negotiating table with enhanced assurances after multiple earlier bids failed to sway Warner’s leadership. The Ellison family and its financial backers have boosted the bid’s appeal by addressing concerns about financing and regulatory approval, two areas that had been criticised by Warner’s board in prior rounds. Combined with the increased per-share price, these modifications aim to make Paramount’s proposal more attractive to both directors and shareholders.

Netflix’s bid, originally agreed in December, marked a departure from its longstanding strategy of organic growth by pursuing an acquisition of one of the industry’s most storied studios and content libraries. Its offer focuses on the studio and streaming assets, excluding some linear television operations to ease potential antitrust concerns. The two proposals now face competing regulatory reviews in the United States and abroad, with officials assessing whether either would substantially diminish competition in global entertainment markets.

Industry analysts have been divided on the merits of the rival bids. Supporters of the Paramount proposal argue that acquiring Warner Bros. Discovery in its entirety could create a more diversified media conglomerate capable of competing more effectively with other major players. Critics, however, warn that consolidation could lead to job losses, reduced diversity in content production and higher costs for consumers. Regulatory scrutiny intensified after the U. S. Department of Justice’s antitrust waiting period for Paramount’s original takeover attempt expired earlier in February, clearing a significant procedural hurdle even as substantive review continues.

Political dynamics have also entered the debate, with commentary from public figures on both sides of the issue, though executives from both companies have emphasised that the decisions should be driven by business considerations and shareholder interests. Paramount’s bid, supported by significant equity commitments and enhanced financial terms, reflects its belief that shareholders stand to benefit from the broader acquisition. Netflix leadership has defended its simpler, more focused offer as better aligned with maintaining the value of the studios and streaming operations.