Netflix and Warner Bros. now appear to be steadily progressing toward what many are calling a corporate marriage of strategic magnitude, even as Paramount Skydance circles the event with intentions to intervene dramatically and disrupt the union. The unfolding scenario reflects not merely a business transaction but a high-stakes contest of vision, power, and market strategy within an increasingly consolidated entertainment landscape.
Earlier this week, Warner Bros. Discovery (WBD) once again declined an overture from Paramount Skydance, rejecting its repeated attempt to acquire the entire company. The decision came shortly after the David Ellison–led firm advanced a hostile bid priced at $30 per share for all outstanding WBD stock. WBD’s board, however, reaffirmed its own preferred course of action: proceeding with the negotiated arrangement with Netflix, which offers $27.75 per share in a carefully structured deal designed to sell off significant assets, including the historic Warner Bros. film studio, HBO, and HBO Max. Under the framework of this Netflix proposal, WBD’s traditional cable television properties—most notably CNN—would be operationally separated from its core studio holdings and digital streaming operations. This partition would mark a decisive strategic realignment of the company’s assets and media focus.
According to WBD’s board chair, Samuel Di Piazza, Paramount’s unsolicited and aggressive offer was deemed “inadequate,” posing what he described as “considerable risks and unacceptable costs” to existing shareholders. Di Piazza’s statement, issued directly to investors on Wednesday morning, cited specific concerns regarding Paramount Skydance’s financial structure and doubt surrounding its ability to secure sufficient funding. His characterization emphasized that, from the perspective of WBD’s leadership, the Netflix alternative was far more secure, transparent, and advantageous to long-term shareholder interests.
Following these developments, WBD issued a public communication reiterating its rejection of Paramount’s bid. The statement encouraged shareholders to maintain confidence in the Netflix transaction, which the board continued to endorse as the superior and safer pathway forward. Nevertheless, WBD clarified that shareholders retained the right to choose: those preferring Paramount’s $30 per share buyout could disregard the board’s recommendation and move independently toward that option. Investors have been allotted until January 8 to make their final decision, although that deadline remains subject to potential revision. Should the arrangement with Netflix ultimately collapse, WBD would owe the streaming giant a substantial termination fee of $2.8 billion—a penalty underscoring the seriousness and commitment underpinning the current negotiations.
In separate statements, Netflix co-chief executives Ted Sarandos and Greg Peters both applauded WBD’s board for its deliberate and rigorous evaluation. They expressed their gratitude while reiterating Netflix’s commitment to moving forward with the merger plan. Sarandos declared that the Warner Bros. Discovery board had once again confirmed “that Netflix’s merger agreement is superior,” insisting that this acquisition represents the most beneficial outcome not only for shareholders but also for the larger ecosystem of creative professionals and consumers. In his remarks, he reiterated Netflix’s intention to maintain Warner Bros.’ tradition of releasing films in theaters, honoring the longstanding industry-standard theatrical window before streaming distribution.
Greg Peters expanded on these points, portraying the proposed merger as a dynamic partnership designed to enhance opportunity and choice for both audiences and creators. He characterized the deal as fundamentally supportive of innovation and growth, describing it as “pro-consumer, pro-creator, and pro-competition.” In a joint letter addressed to WBD shareholders, the two executives outlined their confidence about securing regulatory approval within the next 12 to 18 months. They also disclosed that Netflix had already completed necessary U.S. and international filings, including submissions to the Department of Justice and the European Commission, and was actively cooperating with all relevant competition authorities.
Within the same letter, Sarandos and Peters reaffirmed the carefully negotiated nature of their proposal. They argued that Netflix’s financial foundation provides unparalleled security and predictability, bolstered by the company’s robust $400 billion market capitalization and an investment-grade balance sheet. Their offer, they wrote, is structured with fully committed funding and free from speculative dependencies such as foreign sovereign wealth backing or personal collateralized loans. In contrast, they pointed to the uncertainties inherent in Paramount Skydance’s offer, emphasizing its unclear financing and potential regulatory complications.
The co-CEOs further highlighted Netflix’s longstanding global reputation for steady operational excellence, innovative partnerships, and an industry-leading record of stockholder value creation over more than a quarter century. They emphasized that the company’s strategy has always focused on sustainable growth through creative empowerment—transitioning from DVD distribution to global streaming leadership, from content licensing to original production, and from a domestic U.S. market to a worldwide audience exceeding hundreds of millions of subscribers.
As part of the proposed merger’s structure, Netflix and Warner Bros. would continue to serve consumers with a portfolio of world-renowned film and television properties—ranging from HBO’s prestige series and the DC Universe to cultural phenomena such as *The Big Bang Theory*, *Game of Thrones*, and global Netflix originals like *Squid Game* and *Bridgerton*. Netflix believes it can amplify the reach and profitability of Warner Bros.’ legendary intellectual property by connecting these franchises to its platform in over 190 countries. Given that a significant percentage of HBO Max’s existing user base already overlaps with Netflix’s subscribers, the companies see opportunities to develop flexible, consumer-oriented subscription models tailored to varying viewer preferences.
From an industry perspective, both companies emphasized that their combination would strengthen, rather than diminish, competition. Netflix underscored that its share of U.S. television viewership remains below 10%, surpassed by other giants such as YouTube and Disney. Even when aggregated with Warner Bros.’ holdings, their combined share would remain modest, illustrating that the merger does not result in dominance but rather enhances diversity and capability across the entertainment sector.
Underlining their continued respect for cinematic tradition, both executives confirmed Netflix’s future commitment to theatrical releases—a significant step that reflects their recognition of the theater experience as an integral part of film culture and an essential bridge between creators and global audiences. By adopting Warner Bros.’ deep expertise in theatrical distribution, Netflix signaled its readiness to evolve beyond streaming alone, uniting the strengths of classic Hollywood moviemaking with innovative digital reach.
Ultimately, Sarandos and Peters concluded their letter by affirming Netflix as the rightful steward of Warner Bros.’ century-long artistic heritage. They pledged to honor the studio’s history while progressively expanding its creative and commercial horizons. The executives promised a seamless collaboration with WBD leadership, regulators, and industry partners to preserve the integrity of Warner Bros.’ vast content library, uphold cinematic tradition, and elevate beloved stories to new heights of global visibility. Their message closed with an expression of enthusiasm and respect toward Warner Bros. Discovery CEO David Zaslav and his team, emphasizing a shared ambition: to inspire audiences, empower creators, and together redefine entertainment for generations to come.
Sourse: https://www.businessinsider.com/netflix-response-warner-bros-rejects-paramount-skydance-hostile-bid-sarandos-2025-12
