In a blistering letter released, the board of Warner Bros. Discovery (WBD) unanimously recommended that shareholders reject Paramount Skydance’s unsolicited $108.4 billion takeover bid. Calling the offer “inadequate,” “opportunistic,” and legally “illusory,” the board is doubling down on its rival $82.7 billion merger agreement with Netflix.
This isn’t just a “no,” it’s a declaration of war against Paramount CEO David Ellison, who took his $30-per-share offer directly to WBD shareholders last week in a hostile move that has rocked the industry.
“Smoke and Mirrors” Financing
Why turn down an all-cash offer that is technically $25 billion higher than the Netflix bid? According to WBD Chair Samuel A. Di Piazza Jr., the funds may not be available.
In today’s statement, the board accused Paramount of “consistently misleading” investors about its financing. While Ellison claimed the deal was fully “backstopped” by his family’s massive Oracle fortune, WBD alleges the funding actually relies on an “opaque and revocable” family trust that could vanish at any moment.
“This offer imposes an untenable degree of risk,” Di Piazza stated. “The Netflix merger is a binding agreement with enforceable commitments. The Paramount offer is a wish list.”
The Netflix Factor
The rejection creates a bizarre scenario in which WBD is fighting to be acquired by a company offering less total money.
Under the current Netflix deal, the streaming giant would acquire WBD’s crown jewels: the Warner Bros. film and TV studios, HBO, and the Max streaming service for roughly $82.7 billion in cash and stock. Crucially, this deal leaves behind WBD’s declining “linear” assets (CNN, TNT, TBS) to be spun off into a separate, debt-laden company.
Paramount’s offer was for the whole pie, including CNN and the cable networks. While Ellison argued this was a cleaner break for shareholders, WBD executives clearly view the regulatory hurdles of a Paramount merger, which would combine two major film studios, as a deal-breaker.
The Kushner Twist
The timing of today’s rejection is no accident. It comes less than 24 hours after a major blow to Paramount’s credibility: the exit of Jared Kushner.
On Tuesday, it was revealed that Affinity Partners, the private equity firm run by President Trump’s son-in-law, had quietly pulled its financial backing from the Paramount bid. Kushner’s involvement had already raised eyebrows, given the significant participation of sovereign wealth funds from Saudi Arabia and Qatar.
With Kushner out and questions swirling about foreign capital backing the bid, the “America First” optics of the deal have crumbled, giving WBD a strong opening to challenge the bid’s stability.
What Happens Next?
David Ellison isn’t walking away. Paramount released a statement immediately following the rejection, reaffirming that it has “all necessary financing” and accusing WBD of prioritizing its own jobs over shareholder value.
The clock is ticking. WBD shareholders have until January 8, 2026, to vote on the Paramount tender offer. Until then, expect a scorched-earth campaign from both sides as they compete for institutional investor votes.
For now, the House of Bunny remains locked, and David Zaslav is holding the key.
Whose side are you on? Should WBD take the quick cash from Paramount, or is the Netflix team-up the future of streaming? Drop your thoughts in the comments.