Warner Bros Discovery, on January 7th, announced on its website that the board unanimously rejected the unsolicited modified public acquisition proposal from Paramount Skydance, stating that it did not meet the same standards as Netflix’s merger agreement in several key aspects. The company also posted a letter sent to all shareholders regarding this decision.
According to Warner Bros Discovery, the board unanimously decided that the modified unsolicited public acquisition proposal submitted by Paramount on December 22, 2025, was not in the best interests of Warner Bros Discovery and its shareholders. It did not meet the standard defined in the merger agreement reached with Netflix on December 5, 2025, referred to as a “Superior Proposal.”
In the news released on its official website, Warner Bros Discovery stated that the board reiterated its support for the merger with global streaming giant Netflix and advised shareholders to reject Paramount’s unsolicited public acquisition proposal.
In the letter sent to shareholders, the Warner Bros Discovery board likened Paramount’s acquisition to a leveraged buyout, primarily relying on borrowed funds for the financial operation. The letter pointed out that to complete the transaction, Paramount planned to work with multiple financing partners, resulting in “over $50 billion in additional massive debt,” posing “higher risks” for Warner Bros Discovery and its shareholders.
The Chairman of Warner Bros Discovery board stated, “The board unanimously concluded that the latest proposal from Paramount Skydance falls short in several key aspects compared to our merger agreement with Netflix. The value that Paramount Skydance’s proposal can provide is still insufficient, including conditions that involve a significantly high debt financing ratio, which not only increases the uncertainty of completing the transaction but also fails to provide adequate protection for our shareholders in case the deal falls through. In contrast, the agreement we signed with Netflix is more binding, offering shareholders a superior value with higher certainty, without exposing them to the significant risks and costs brought by Paramount Skydance’s proposal.”
Paramount’s CEO is David Ellison, the son of Oracle founder and billionaire Larry Ellison. Larry Ellison is one of the wealthiest individuals globally. Paramount attempted to address financing concerns by highlighting the source of funds, such as Larry Ellison providing most of the funding for the acquisition.
On December 5, 2025, Warner Bros Discovery announced an agreement with Netflix to sell its film studio (Warner Bros), television studio, and HBO Max streaming division to Netflix for $27.75 per share, with $23.25 per share in cash and the rest in Netflix stocks. Paramount, at that time, offered nearly $24 per share, aiming to acquire the entire Warner Bros Discovery, including its cable networks.
On December 8, 2025, Paramount submitted an unsolicited tender offer to Warner Bros Discovery, intending to acquire all outstanding common shares. On December 22, 2025, Paramount submitted the modified version of the offer. An unsolicited tender offer is akin to a direct appeal to shareholders to acquire stocks. Paramount raised its offer price to $30 per share, but Warner Bros Discovery’s announcement on January 7 indicated that the public acquisition proposal was unanimously rejected by its board.