Amid the high-stakes contest for control of Warner Bros. Discovery (WBD), one group has already emerged as the indisputable victor — the major Wall Street investment banks orchestrating the transaction. While tech and media titans Netflix and Paramount are locked in a fierce bidding war for ownership, the biggest financial windfall is destined to flow toward the advisory institutions guiding the negotiations. A new filing with the U.S. Securities and Exchange Commission reveals that WBD stands prepared to distribute an extraordinary $225 million in advisory compensation to leading firms Allen & Co., J.P. Morgan, and Evercore, provided that the sale is successfully consummated with either Netflix or David Ellison’s Paramount Skydance.
This eye-catching figure shines a light on the significant role financial intermediaries play in shaping the outcome of modern entertainment mergers. Over the past several months, Warner Bros. Discovery has been carefully weighing competing proposals. Netflix, the global streaming powerhouse, has proposed acquiring WBD’s storied film studio and streaming assets—an effort to expand its creative footprint and solidify its dominance in content production. Meanwhile, Paramount’s counteroffer seeks not just the studio and streaming divisions but the entirety of the company’s operations, including its extensive cable television networks. The competition has been anything but cordial. Paramount went so far as to launch a hostile bid, a bold maneuver that prompted WBD’s board of directors to reaffirm on Wednesday its formal endorsement of Netflix’s proposal after reviewing both financial and strategic implications.
Throughout this intensive bidding process, WBD’s advisors have been omnipresent, deeply embedded in each stage of evaluation and decision-making. Their engagement extended far beyond simple consultation. Representatives from Allen & Co., J.P. Morgan, and Evercore were heavily involved in boardroom deliberations, direct negotiation sessions, analytical reviews, and the iterative feedback cycles that informed each successive proposal. Their expertise was central to appraising the relative value and feasibility of each bid, ensuring that WBD’s board had a comprehensive understanding of the possible deal structures.
The company also provided detailed transparency regarding compensation for these advisors. According to its disclosure, Allen & Co. will receive a total of $85 million in fees, with $45 million contingent upon the successful completion of the sale. J.P. Morgan’s compensation mirrors this arrangement, also totaling $85 million, though $50 million of the payment will depend on closing conditions being met. Evercore, the third principal advisor, is slated to collect $55 million, likewise tied entirely to the deal’s completion. Such conditional structures are commonplace in corporate finance, ensuring that banks remain motivated to deliver successful results while aligning their incentives with those of the client.
Beyond its core financial advisors, WBD enlisted an additional network of specialized firms to navigate the multilayered process of investor relations and public perception. Innisfree, a shareholder communications consultancy, was retained to manage communication with investors, while Joelle Frank, a renowned financial public relations firm, managed WBD’s messaging and media engagement throughout the unfolding negotiations. Legal expertise was equally critical; heavyweight law firms Debevoise & Plimpton, Wachtell Lipton, and Covington & Burling each lent their seasoned counsel to ensure compliance, risk mitigation, and deal structuring precision.
Paramount, on the opposing side, assembled its own formidable advisory team. Centerview Partners led its financial consultation, joined by RedBird Capital—backing the Paramount Skydance bid—alongside established players Bank of America, Citigroup, and M. Klein & Company. Netflix, meanwhile, sought the advisory expertise of Moelis & Co., adding yet another prestigious name to the roster of financial institutions benefiting from the feverish pace of consolidation sweeping through Hollywood.
The structure of these deals underscores a long-established dynamic in corporate finance: investment banks earn through a hybrid model of retainers—paid upfront to secure advisory services—and success fees, payable upon deal closure. The proportional value of these fees tends to diminish as transaction sizes escalate, yet the absolute numbers remain astonishing due to the immense sums involved in industry-transforming mergers.
According to a recent PwC corporate deals outlook, the current climate has been exceptionally robust for media and telecommunications mergers and acquisitions. The report described an especially strong second half of 2025, powered by favorable lending conditions, corporate restructuring initiatives, and investor enthusiasm for high-value intellectual property. Notable recent transactions such as the privatization of gaming giant Electronic Arts and the anticipated sale of the Los Angeles Lakers illustrate how diverse sectors—from digital entertainment to elite sports—are driving a resurgence in high-value transactions. Excluding the prospective sale of WBD, PwC documented a remarkable 61% year-over-year surge in total deal value between the latter halves of 2024 and 2025.
Looking ahead, PwC forecasts that this vigorous M&A momentum will not only persist but accelerate in the coming years. Institutional investors and private capital are expected to continue aggressively pursuing content-rich assets—catalogs of films, music, and streaming intellectual property—as well as video game studios and sports franchises, each capable of being monetized through an expanding range of digital and experiential channels. In this environment, where capital, creativity, and media distribution increasingly intersect, the ultimate storyline is clear: while the corporate giants vie for dominance, the financial architects behind the scenes are positioned to collect the real box office haul.
Sourse: https://www.businessinsider.com/wall-street-banks-win-warner-bros-weighs-netflix-paramount-bids-2025-12
