Paramount has launched a bold move to acquire Warner Bros Discovery, igniting a fierce bidding war with Netflix for control of the media powerhouse. The company has proposed a bid of $US30 ($45) per share, directly challenging the $108 billion deal between Warner Bros Discovery (WBD) and Netflix announced just last week.
This development sets the stage for a high-stakes battle between Paramount, owned by Larry Ellison—an ally of Donald Trump—and the streaming giant Netflix, both vying for one of Hollywood’s most iconic studios. Netflix’s announcement last week of its agreement to purchase Warner Bros sent shockwaves through the industry, eliciting strong reactions from Hollywood insiders concerned about the sector’s future.
Paramount’s Strategic Offer
Paramount’s latest bid stands out by including cable channels such as CNN, TNT, TBS, and Discovery, which would fall under a company with close ties to the Trump administration. Valuing the entertainment giant at $US108.4 billion, Paramount’s offer represents a 139 percent premium over WBD’s September stock price of $US12.54, when the bidding war began.
“WBD shareholders deserve an opportunity to consider our superior all-cash offer,” said David Ellison, chairman and CEO of Paramount.
In contrast, Netflix’s bid values Warner Bros studios at nearly $US83 billion, which Paramount has criticized as “inferior and uncertain.” Paramount argues that its proposal offers greater regulatory certainty compared to Netflix’s, which would give Netflix a 43 percent share of global streaming subscribers and face “protracted regulatory challenges across the world.”
Industry Implications and Historical Context
Over the decades, Warner Bros has been a cornerstone of Hollywood, producing timeless classics such as “Casablanca” and “Citizen Kane,” as well as modern blockbusters like “The Sopranos,” “Game of Thrones,” and the “Harry Potter” series. The potential merger would combine Paramount’s assets—including Paramount Pictures, CBS, Nickelodeon, and Paramount+—with WBD’s holdings like HBO Max and major sports rights.
Paramount claims the merger would generate more than $US6 billion in cost savings while maintaining theatrical releases and increasing content spending. The issue of theatrical releases remains a sensitive topic in Hollywood, where many view them as essential to cinema’s prestige and economic health.
Netflix is already viewed negatively in some Hollywood circles, largely due to its reluctance to release content in theatres and its disruption of traditional industry practices.
Market Reactions and Future Prospects
Following Paramount’s announcement, Warner Bros Discovery’s share price surged by more than 7 percent on Monday, while Netflix’s shares dropped by over 2 percent. The market’s response underscores the high stakes and uncertainty surrounding the ongoing bidding war.
As the battle for Warner Bros Discovery unfolds, industry experts are closely watching how the merger could reshape the media landscape. The outcome could significantly impact content distribution, regulatory landscapes, and the balance of power among media giants.
Looking ahead, the industry awaits further developments as both Paramount and Netflix make their cases to WBD shareholders and regulators. The resolution of this bidding war will likely have lasting implications for Hollywood and the global entertainment industry.
