How I Made $5000 in the Stock Market

Warner Bros. Urges Shareholders to Reject Paramount Bid. Netflix Stock Is Rising.

Dec 17, 2025 07:08:00 -0500 by George Glover | #Media

Warner Bros. Discovery urged shareholders to reject Paramount’s offer on Wednesday. (Mario Tama/Getty Images)

Key Points

There is more drama from Hollywood’s biggest takeover battle.

The board of Warner Bros. Discovery urged shareholders to reject an offer from Paramount Skydance on Wednesday, instead recommending that they back Netflix’s rival bid.

Warner’s board said that Paramount had “consistently misled” shareholders by claiming that its offer had been fully backstopped by the Ellison family, which includes Oracle Executive Chair Larry Ellison and Paramount CEO David Ellison.

“Despite having been told repeatedly by WBD how important a full and unconditional financing commitment from the Ellison family was, the Ellison family has chosen not to backstop the PSKY offer,” Warner’s board wrote in a letter to shareholders.

The board said it was unanimously backing the offer Netflix made on Dec. 5 for Warner’s studios and streaming assets. It added that its agreement with Netflix represents the best way to create value for shareholders.

Paramount didn’t immediately respond to requests for comment from Barron’s. It said in a news release on Wednesday that its offer will be financed by $41 billion of new equity backstopped by the Ellison family and RedBird Capital and $54 billion of debt commitments from Bank of America, Citigroup and Apollo.

“Paramount’s offer provides WBD shareholders superior value compared to the transaction with Netflix, including the certainty of 100% cash and no exposure to equity market fluctuations,” Paramount said.

Netflix said in a statement that it welcomed the Warner board’s recommendation.

Created with Highcharts 9.0.1Source: FactSet

Created with Highcharts 9.0.1Warner Bros. DiscoveryParamount SkydanceNetflixDec. 3Dec. 16-20-15-10-50510152025%

Warner Bros. stock dropped 1.3% to $28.52 on Wednesday, likely on the expectation that the emphatic rejection could put an end to the bidding war. Paramount fell 4.8% to $13.19 and was on pace for its lowest close since Aug. 12, according to Dow Jones Market Data. Netflix stock climbed 1.2% to $95.69.

Netflix’s offer gives shareholders $23.25 in cash, $4.50 in shares of Netflix common stock, and additional shares in a spun-out Discovery cable networks business. Paramount’s Dec. 8 hostile bid is for all of Warner Discovery, at $30 a share, and includes a $40.65 billion equity commitment.

Paramount wants Warner Bros. as it works to grow in the entertainment industry, competing against larger players such as Walt Disney and Netflix. Raymond James analyst Ric Prentiss said in a Wednesday research note that he thinks Paramount might raise its offer to pull that off.

“We could see bidding getting into the mid-$30s (e.g., as high as ~$35 in total for all of WBD), but ultimately have a hard time seeing it go above that level,” he wrote.

Some investors were already worrying about how Paramount would fund the takeover deal. Jared Kushner’s private-equity firm Affinity Partners had been an equity investor in Paramount’s offer, but it said in a statement on Tuesday that it was no longer involved, according to The Wall Street Journal. Affinity didn’t immediately respond to a request for comment from Barron’s.

Paramount’s tender offer is set to expire on Jan. 8, so it will have until then to make a decision on whether to improve its bid. More plot twists could follow.

Write to George Glover at george.glover@dowjones.com and Angela Palumbo at angela.palumbo@dowjones.com