What's happened
Warner Bros. Discovery (WBD) is at the center of a legal and corporate battle as Paramount and Netflix vie to acquire its assets. Paramount has launched a lawsuit demanding more financial disclosures and is preparing a proxy fight, while Netflix continues negotiations amid regulatory scrutiny. The outcome remains uncertain as shareholder votes and legal actions unfold.
What's behind the headline?
Paramount's legal strategy aims to pressure WBD into revealing detailed valuation methods for its assets, especially the Global Networks division, which Paramount claims is undervalued. This move is designed to sway shareholder opinion by providing transparency and highlighting potential undervaluation in WBD's current deal with Netflix.
The legal and shareholder battles are intertwined, with Paramount seeking to leverage shareholder votes and potential litigation to block or renegotiate the Netflix deal. The proposed bylaws amendment to require shareholder approval for spinoffs could significantly alter WBD's strategic options.
Netflix's involvement indicates a broader industry contest, with regulatory approval being a key hurdle. The lengthy review process, estimated at 12-18 months, suggests that the outcome will heavily depend on regulatory and shareholder decisions.
The story underscores the high stakes in media mergers, where valuation disputes, legal tactics, and shareholder influence can dramatically alter industry consolidation. It also highlights the increasing importance of transparency and legal oversight in large corporate transactions, especially in a rapidly evolving digital media landscape.
What the papers say
According to Ars Technica, Paramount's CEO David Ellison has filed a lawsuit demanding detailed disclosures from WBD, asserting that shareholders need this information to make an informed decision. The article notes Paramount's efforts to nominate directors and amend bylaws to influence the sale process, emphasizing the legal and strategic dimensions of the battle.
Business Insider UK reports that Paramount has made eight unsuccessful bids for WBD, and now seeks to use legal action and shareholder proxies to sway the outcome. The article highlights the possibility of a renewed bidding war, with insiders suggesting Paramount might increase its offer or pursue litigation if its proposal is not accepted. Both sources agree that the fight is driven by valuation concerns and strategic interests, with regulatory approval looming as a critical hurdle.
How we got here
In December 2025, WBD agreed to sell its streaming and movie businesses to Netflix for $82.7 billion, with plans to spin off its Global Networks division. Paramount responded with a hostile takeover bid valued at $108.4 billion, prompting WBD to reject multiple offers and raise concerns about the bid’s financial viability. Paramount has since filed a lawsuit demanding detailed valuation disclosures and announced plans to nominate directors and amend bylaws to influence the sale process. Meanwhile, Netflix is working with regulators to secure approval for its acquisition, which is also subject to lengthy review. The ongoing dispute reflects broader tensions in the media industry over valuation, control, and strategic direction.
Go deeper
- What are Paramount's main legal arguments against WBD?
- How might regulatory approval influence Netflix's plans?
- Could this lead to a bidding war or strategic shift?
More on these topics
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David Ellison is an American film producer and the founder and CEO of Skydance Media.
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Netflix, Inc. is an American technology and media services provider and production company headquartered in Los Gatos, California. Netflix was founded in 1997 by Reed Hastings and Marc Randolph in Scotts Valley, California.
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Warner Bros. Discovery is an upcoming American multinational mass media and entertainment conglomerate. The company will be formed though the merger of WarnerMedia and Discovery, Inc., which is expected to be completed by mid-April 2022.
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ViacomCBS Inc. is an American diversified multinational mass media conglomerate formed through the merger of CBS Corporation and the second incarnation of Viacom in 2019, which were split from the original incarnation of Viacom in 2005.