Warner Bros. Discovery is officially reviewing a revised acquisition proposal from David Ellison’s Paramount, the company confirmed Tuesday. The announcement comes as WBD navigates competing bids for the media conglomerate, with streaming giant Netflix already holding a signed agreement to acquire portions of the company. The Warner Bros. Discovery board stated it is consulting with financial and legal advisors on the sweetened Paramount offer.
According to a statement from the WBD board, the company received the revised proposal from Paramount during a seven-day limited waiver period. While specific details of the enhanced bid were not disclosed, the board emphasized that the Netflix merger agreement remains in effect and continues to recommend shareholders vote in favor of the Netflix transaction. Paramount also released a statement confirming its revised bid but did not reveal additional terms.
Previous Paramount Offer Included Financial Sweeteners
The latest proposal marks the first authorized bid from Paramount since Warner Bros. Discovery opened a negotiating window last week. Previously, on February 10, Paramount had offered $30 per share with a “ticker” mechanism that would increase the price quarterly if the deal had not closed past year-end. That earlier offer included a promise to cover the $2.8 billion breakup fee owed to Netflix and backstop a refinancing plan expected to cut costs by $1.5 billion.
Additionally, Paramount’s February proposal featured a ticking fee of $650 million in cash per quarter if the deal failed to complete by the end of 2026. Ellison stated at the time that the company was “making meaningful enhancements” and providing shareholders with certainty and protection against market volatility. However, authorities have not confirmed whether these terms remain part of the current revised offer.
Netflix Deal Faces Shareholder Vote Next Month
The competing bids create a complex situation for Warner Bros. Discovery shareholders, who are scheduled to vote on the Netflix merger on March 20. Under the existing agreement, Netflix is acquiring only the Warner Bros. studio and HBO business operations, not the entire company. The original Netflix deal was first announced in December at $82.7 billion and was later amended to an all-cash bid in late January.
Meanwhile, the ongoing bidding war has impacted Netflix’s stock performance. According to Guggenheim Securities analyst Michael Morris, the path to conclusion on the WBD bid “will remain a primary sentiment driver and likely share appreciation limiter over the next three months.” Robert Fishman of MoffettNathanson echoed this concern, noting that Netflix’s stock price may struggle to rebound as long as the potential bidding war continues.
Warner Bros. Discovery Could Return to Netflix
The revised Paramount proposal may prompt Warner Bros. Discovery to return to Netflix and determine if the streaming company will exercise its right to match the competing offer. Under the signed deal agreement, Netflix is permitted to respond by matching Paramount’s bid. However, because Netflix is only purchasing specific WBD assets rather than the entire company, a matching offer would not necessarily replicate Paramount’s all-company acquisition proposal.
In contrast to previous bids, this marks the first time Paramount has submitted an authorized proposal since the Netflix agreement was signed. Some smaller shareholders have reportedly pressured WBD to engage with Paramount’s offers. The company has advised shareholders not to take any action at this time with respect to the amended Paramount tender offer.
With the shareholder vote approaching and regulatory review still pending, the outcome of the Warner Bros. Discovery acquisition battle remains uncertain. The board is expected to provide an update to shareholders following its review of the Paramount proposal, though no specific timeline has been announced.