WBD Plays Hardball: Netflix Vote Set as Rival Gets One Last Chance

NEW YORK, NY – February 17, 2026 – In a dramatic move that could reshape the global entertainment landscape, Warner Bros. Discovery announced today it has scheduled a March 20 shareholder meeting to vote on its proposed merger with Netflix, while simultaneously cracking open the door for a rival suitor. In a calculated maneuver, Netflix has granted WBD a seven-day waiver, allowing it to engage with Paramount Skydance (PSKY) to solicit a “best and final” offer, setting the stage for a high-stakes showdown over the future of HBO, Warner Bros. Studios, and DC Comics.

The WBD Board of Directors continues to unanimously recommend its existing deal with Netflix, a transaction it praises for offering “tremendous value,” a “clear path to achieve regulatory approval,” and protection against market risk. Yet, the one-week negotiation window with PSKY, ending February 23, signals that the battle for WBD’s prized assets is far from over. This comes after a representative for PSKY orally communicated a willingness to offer $31 per share, hinting that even this was not its final price, a figure not yet reflected in any formal, written proposal.

“Throughout the entire process, our sole focus has been on maximizing value and certainty for WBD shareholders,” said David Zaslav, President and CEO of Warner Bros. Discovery, in a statement. “We are engaging with PSKY now to determine whether they can deliver an actionable, binding proposal that provides superior value and certainty.”

A Tale of Two Deals

The two proposals on the table represent vastly different futures for Warner Bros. Discovery. The preferred Netflix deal is a strategic acquisition of WBD's streaming and studio businesses, including the iconic Warner Bros. film and TV studios and the HBO/Max content library. Valued at approximately $82.7 billion, the deal would see Netflix absorb these assets while WBD’s linear cable networks, like Discovery Channel and HGTV, would be spun off into a separate public company called “Discovery Global.” Bolstered by strong Q4 2025 earnings and subscriber growth, Netflix presents itself as a financially stable partner with a clear vision for integrating WBD's content machine into its global streaming empire.

In the other corner, Paramount Skydance has been pursuing a more ambitious, and according to WBD, far riskier, takeover of the entire company. PSKY’s pursuit began in September 2025 and has included multiple offers, including a hostile bid in December valued at an enterprise level of roughly $108.4 billion. Despite backing from prominent financiers, the WBD board has twice unanimously rejected PSKY’s proposals, citing unfavorable terms and significant uncertainty.

Financial analysts have pointed to potential weaknesses in PSKY's position. With an Altman Z-Score of 0.87, the company is considered to be in a financial “distress zone,” suggesting a higher risk profile. The prospect of taking on WBD would create what some analysts call a “staggering leverage profile,” raising serious questions about the combined entity's financial stability and necessitating aggressive cost-cutting or asset sales post-merger.

The Devil in the Details

While PSKY’s headline price may seem higher, WBD’s board has made it clear that a deal is about more than just a number. In a sharply worded letter sent to the PSKY board, WBD outlined a series of critical deficiencies in the current offer, effectively providing a roadmap for what a “best and final” proposal must contain. WBD is demanding concrete, binding commitments, not just “vague assurances of intention.”

Key among WBD’s demands are provisions to de-risk the transaction for its shareholders. The company is insisting that PSKY provide an “Equity Cure,” a mechanism that would force PSKY’s backers to fund the deal with additional equity if its significant debt financing becomes unavailable. This demand directly addresses the closing uncertainty created by PSKY’s heavy reliance on debt, a stark contrast to Netflix's investment-grade credit rating.

Furthermore, WBD is demanding changes to the “Material Adverse Effect” (MAE) clause. By seeking to exclude the performance of its own linear networks business from the MAE definition, WBD is preventing PSKY from using a potential downturn in the traditional cable market as an excuse to walk away from the deal before closing. WBD also rejected PSKY’s proposed interim operating covenants, which it argued would unduly restrict its ability to run its business and “further risk the certainty of closing.”

“As announced today, we continue to believe the Netflix merger is in the best interests of WBD shareholders,” stated Samuel A. Di Piazza, Jr., Chair of the WBD Board. He emphasized the Netflix deal’s protections for shareholders against downside risk, a clear jab at the perceived instability of the PSKY alternative.

Redefining the Streaming Universe Amid Regulatory Scrutiny

Whichever deal prevails, it will trigger a seismic shift in the media industry and face intense regulatory review. The U.S. Department of Justice is already conducting an antitrust investigation into both potential mergers, with lawmakers expressing deep concerns about the concentration of content creation and distribution power in the hands of a single entity.

A Netflix-WBD combination would primarily be a vertical merger, uniting a massive content producer (Warner Bros., HBO) with a dominant global distributor (Netflix). Proponents, including Netflix itself, argue this would expand content creation. However, critics and regulators worry it could give Netflix the power to withhold blockbuster content from rival streaming services and movie theaters, ultimately harming consumer choice and increasing prices.

Conversely, a PSKY-WBD merger would represent a massive horizontal consolidation, combining two of the largest legacy media companies. This would raise different but equally serious antitrust flags, particularly around the combined entity's control over cable networks, broadcast television, and film production, potentially narrowing the diversity of viewpoints available to the public.

With the clock now ticking toward the February 23 deadline, the ball is firmly in Paramount Skydance’s court. It has seven days to transform its ambitious but flawed proposal into a binding, actionable offer that not only surpasses the Netflix deal in value but also provides the ironclad certainty that the Warner Bros. Discovery board demands. For shareholders, the choice presented on March 20 could determine the very definition of entertainment for decades to come.