NEW YORK (Diya TV) — Warner Bros. Discovery has urged its shareholders to reject Paramount Global’s latest takeover bid, saying a rival deal with Netflix offers more certainty and less financial risk. The company made its position clear on Wednesday, adding a new twist to a high-stakes battle that could reshape Hollywood.
Warner Bros. Discovery said Paramount’s proposal relies on complex financing that puts shareholders at risk. The media giant noted that even a personal financial guarantee from billionaire Larry Ellison does not offset those concerns. The board said Netflix’s offer, announced in December, provides a clearer and safer path. Netflix agreed to buy most of Warner Bros. Discovery’s TV and film assets for $83 billion. That deal stunned the entertainment industry and set off months of speculation about consolidation in streaming.
“This aggressive transaction structure poses materially more risk for WBD and its shareholders,” the board wrote in a letter.
Paramount’s chief executive, David Ellison, has led an intense effort to acquire Warner Bros. Discovery. He has backing from his father, Oracle co-founder Larry Ellison, one of the world’s richest men. Paramount has taken its case directly to shareholders after Warner’s board rejected its offer.
The company said Larry Ellison would personally guarantee $40 billion in equity. Paramount also plans to raise about $54 billion in debt and secure funding from Middle Eastern sovereign wealth funds. Still, Warner Bros. Discovery said the structure creates too much uncertainty. Paramount has a credit rating just above junk status. Netflix holds an investment-grade rating, which makes financing cheaper and more stable.
Warner Bros. Discovery argued that Netflix’s mostly cash deal carries fewer risks if problems arise. The board also raised concerns about what would happen if a Paramount deal collapsed. Paramount wants limits on how Warner Bros. Discovery runs its business until a deal closes. Those limits include blocking plans to carve out its cable TV unit. Paramount also wants restrictions on how Warner refinances a $15 billion bridge loan.
If talks fail, Warner warned, shareholders could be stuck with a weakened company. “WBD shareholders would be left with shares in a business that has been restricted from pursuing its key initiatives for up to 18 months,” the board said. Warner also said Paramount has not agreed to cover the $2.8 billion breakup fee owed to Netflix if Warner exits that deal.
Any deal involving Warner Bros. Discovery will face federal review. Regulators must approve major media mergers. President Trump has said he plans to play a role in decisions involving large corporate combinations. The Netflix deal would give the streaming leader, HBO Max, and the Warner Bros. movie and television studio. That move could deepen Netflix’s dominance as it competes with Disney, Amazon, and other streaming rivals. Analysts say regulators may scrutinize the deal closely but could view Netflix’s acquisition as simpler than Paramount’s proposal.
A key dispute centers on the value of Warner Bros. Discovery’s cable business. The company plans to spin off those assets as cord-cutting accelerates across the U.S. David Ellison has argued the cable unit would trade at about $1 a share. He says that low valuation supports Paramount’s case for buying the entire company instead of selling pieces to Netflix.
Recent market activity has fueled debate. Comcast spun off its own cable business, called Versant, earlier this week. Shares have dropped more than 20 percent since. Some analysts blame forced selling by index funds, though concerns about the long-term future of cable also weigh on prices.
Paramount now faces a choice. It can raise its bid or keep pressing shareholders to back its offer over Netflix’s. Warner Bros. Discovery has made clear where it stands, but the fight may not be over. The outcome could reshape the media landscape. It may also signal how Wall Street views risk, debt, and scale in the streaming wars. For now, Warner Bros. Discovery is betting that certainty matters more than ambition.
