Paramount Escalates Hostile Bid for Warner Bros. Discovery

LOS ANGELES and NEW YORK – February 17, 2026 – The high-stakes battle for the future of Warner Bros. Discovery (WBD) escalated Tuesday as Paramount Skydance Corporation (PSKY) publicly rebuked WBD’s board for its handling of Paramount's acquisition offer. In a sharply worded statement, Paramount criticized WBD for providing a limited seven-day negotiation "waiver" while simultaneously pushing forward with a shareholder vote on what Paramount deems an "inferior" merger agreement with Netflix.

The move signals an increasingly hostile phase in the fight for one of Hollywood's most storied portfolios. Paramount is waging a multi-front war to acquire WBD, combining a direct tender offer to shareholders with a proxy battle aimed at dismantling the pre-existing Netflix deal. At the center of the conflict is Paramount's $30 per-share all-cash offer, which it positions as unequivocally superior to the complex and less certain value offered by Netflix.

A Financial Showdown: Certain Cash vs. Complex Value

The core of Paramount's argument rests on the clear financial disparity between the two proposals. Paramount has put a firm $30 per share all-cash offer on the table to acquire the entirety of Warner Bros. Discovery, a deal valuing the company's enterprise at approximately $108.4 billion. To sweeten the pot and address concerns over regulatory timelines, Paramount added a 25-cent-per-share quarterly "ticking fee" that would begin in 2027, compensating WBD shareholders for any delays in closing the transaction. Furthermore, Paramount has committed to covering the $2.8 billion termination fee WBD would owe Netflix if it walks away from their agreement.

By contrast, the Netflix deal, which the WBD board has unanimously recommended, involves the acquisition of WBD's streaming and studios division for a stated all-cash price of $27.75 per share. However, this transaction also involves spinning off WBD's linear networks, including CNN and HGTV, into a separate publicly traded company called "Discovery Global," in which WBD shareholders would retain a stake.

Paramount has attacked the uncertainty inherent in this structure. According to WBD's own proxy materials, the final cash consideration for shareholders could range from a minimum of $21.23 to a maximum of $27.75, with the final amount contingent on the debt levels of the spun-off "Discovery Global." Paramount's analysis suggests the actual payout could be as low as $23.20 per share if the new company is spun off with leverage comparable to its peers.

"By contrast, Paramount already offers a higher value of $30 per share, all-cash and a more expeditious and certain path to closing a transaction," the company stated, highlighting the ticking fee as proof of its confidence.

A Board Under Pressure and a Clock Ticking

Paramount's latest salvo takes direct aim at the fiduciary conduct of the Warner Bros. Discovery board. The statement notes that by granting a simple "waiver," the board "has chosen to avoid making the customary determination" that Paramount's bid "could reasonably be expected to result in" a superior proposal. Such a determination would have freed the board to negotiate with Paramount without a restrictive deadline.

Instead, WBD has granted a seven-day window, ending February 23, for Paramount to present its "best and final" offer. Simultaneously, the board is proceeding with its special shareholder meeting scheduled for March 20 to seek approval for the Netflix merger, having already begun mailing proxy materials to investors. WBD's board has twice formally rejected Paramount's advances, citing concerns over financing and unfavorable conditions, though it has acknowledged in public filings that a Paramount representative informally suggested a willingness to increase the offer to $31 per share if formal negotiations were opened.

This two-track approach—engaging with Paramount under a tight deadline while actively campaigning for the Netflix deal—highlights the immense pressure on the WBD board. It must demonstrate to shareholders, and potentially the courts, that it is fulfilling its duty to maximize value, especially with a higher all-cash offer on the table. Activist investor Ancora Holdings has already publicly sided with Paramount, arguing its proposal offers better value and regulatory clarity, and has pledged to vote against the Netflix deal.

Paramount is not waiting for the board's blessing. It has vowed to "continue to advance our tender offer, maintain our solicitation in opposition to the inferior Netflix merger, and proceed with our intention to nominate a slate of directors at the upcoming WBD annual meeting."

Regulatory Hurdles Loom for Any Combination

Whichever path WBD shareholders choose, the road to a closed deal is fraught with significant regulatory challenges. The U.S. Department of Justice has launched wide-ranging antitrust reviews into both potential mergers, and international bodies in the UK and EU are also expected to conduct their own assessments.

A Netflix-WBD combination faces scrutiny over its potential to create a juggernaut in the streaming market. Critics, including the Writers Guild of America, argue that merging the world's largest streaming service with the content library of HBO, DC Comics, and Warner Bros. studios could give the combined entity control of 30-40% of the subscription streaming market. This raises fears of reduced consumer choice, higher prices, and monopsony power over creative talent, potentially suppressing wages and creative freedom.

Conversely, a Paramount-WBD merger would create a different kind of behemoth—a massive, horizontally-integrated media conglomerate rivaling Disney in scale. This has drawn sharp criticism, with Senator Elizabeth Warren calling the potential tie-up a "five-alarm antitrust fire." Concerns focus on the reduction of major Hollywood studios from five to four and the resulting consolidation of power. Additionally, the financing for Paramount's bid, which includes backing from sovereign wealth funds in the Middle East, could invite scrutiny from the Committee on Foreign Investment in the United States (CFIUS), although Paramount has stated these investors will hold no governance rights.

The WBD board has maintained that the Paramount deal "does not have an easier or faster path to regulatory approval" than the Netflix merger, a key justification for its continued support of the latter.

The Future of Hollywood at Stake

This corporate battle is more than a dispute over share price; it represents a pivotal moment that will define the next era of the media industry. The outcome will fundamentally reshape the competitive landscape of the "streaming wars" and determine the structure of Hollywood for years to come.

A successful acquisition by Netflix would cement its status as the undisputed leader in global streaming. By absorbing the iconic intellectual property of Warner Bros. and HBO—from Harry Potter and Batman to Game of Thrones and Succession—Netflix would create an unparalleled content arsenal, further distancing itself from competitors. The move would represent a massive consolidation of streaming and studio power under a single, digitally-native roof.

A victory for Paramount Skydance would forge a new legacy giant. The combination of Paramount, CBS, MTV, and Nickelodeon with Warner Bros., HBO, and CNN would create a diversified media empire with immense scale across broadcast television, cable networks, film studios, and multiple streaming services. This new entity would be positioned as a formidable competitor not just to Netflix, but to the Walt Disney Company, creating a new "Big Three" in global media and entertainment. The pressure for further consolidation among the remaining players would become immense.

With Paramount's negotiation window closing on February 23 and the shareholder vote set for March 20, the fate of Warner Bros. Discovery, and the strategic alignment of the entire media industry, hangs in the balance.