Bidding War Intensifies for Control of Warner Bros. Discovery

The contest to acquire media giant Warner Bros. Discovery has entered a new and fiercely competitive phase. A hostile bid from Paramount Skydance has thrown the previously arranged deal with Netflix into serious doubt, creating significant volatility for the conglomerate's stock. Investors are now forced to evaluate the certainty of an all-cash proposal against the potential long-term strategic benefits of a merger.

Regardless of the takeover battle's outcome, Warner Bros. Discovery's underlying financial position remains challenging. The company carries a substantial net debt load of $34.5 billion. While its streaming division reported growth to 128 million subscribers in the third quarter of 2025, the corporation posted a net loss exceeding $11 billion for the full 2024 year. This figure was heavily impacted by a significant $9.1 billion impairment charge.

Both potential acquisitions face intense regulatory scrutiny. Netflix has attempted to address antitrust concerns by arguing that a combined entity would control only a 9% market share in the United States. Conversely, the Paramount offer's backing introduces a separate layer of regulatory uncertainty due to foreign ownership of major U.S. media assets.

Should investors sell immediately? Or is it worth buying Warner Bros. Discovery (A)?

A Hostile $108.4 Billion Cash Bid Emerges

In a direct move to shareholders, the Paramount Skydance consortium has launched a hostile takeover attempt, bypassing Warner Bros. Discovery's management entirely. The group has placed an enterprise value of $108.4 billion on the target company, translating to a cash offer of $30.00 per share. This substantial bid is financially backed by a coalition of heavyweight investors, including sovereign wealth funds from Saudi Arabia, Abu Dhabi, and Qatar, alongside an investment fund linked to Jared Kushner. Market sentiment is reflected in the current share price hovering around $29.98—just below the offer price—indicating high shareholder expectations but also factoring in potential regulatory hurdles.

Netflix's Strategic Position Under Threat

Netflix now finds itself pressured by a superior cash proposition. The streaming leader had previously reached an agreement to acquire the studio operations, HBO, and content archives of Warner Bros. Discovery for $82.7 billion. That deal was valued at approximately $27.75 per share, comprising $23.25 in cash and $4.50 in Netflix stock. In communications to employees and stakeholders, Netflix Co-CEOs Greg Peters and Ted Sarandos have defended their agreement's competitive implications. Furthermore, Netflix has protected its position with a substantial $5.8 billion breakup fee, payable by Warner Bros. Discovery if it abandons their pact in favor of the Paramount proposal.

The coming weeks will determine whether Paramount's higher cash offer will prevail over the strategic alliance with Netflix, or if regulatory obstacles will ultimately block the deal. Shareholders of Warner Bros. Discovery currently hold considerable influence over the final outcome.