After Warner Bros. rejected Paramount’s proposal to buy the media giant, after the former had enthusiastically entertained a lower offer from Netflix, Paramount is playing the role of bitter, jilted lover to a tee.
Having secured backing from Paramount CEO and chairman David Ellison’s wealthy father, Larry Ellison (co-founder of Oracle), Paramount has announced its intention to sue Netflix for the details of the impending buyout.
The Warner Bros./Paramount/Netflix love triangle Explained
It was only last month that Warner Bros.’ board was urging its investors to reject Paramount’s overtures, since the ultimate yes-or-no lay with the investors, not the board. They argued that Netflix’s deal, although about 30 percent less than Paramount’s, was superior.
Warner Bros.’ board publicly released a letter to its shareholders, saying, “The terms of the Netflix merger are superior. The PSKY (Paramount Skydance, the full name of the company) offer provides inadequate value and imposes numerous, significant risks and costs on WBD (Warner Bros. Discover).”
Part of that was driven by a disagreement over how much the financially powerful Larry Ellison family would guarantee. Initially, there seemed to be no agreement from Larry, which at least partially drove Warner Bros.’ hesitation to accept Paramount’s deal.
Now that Larry has provided that guarantee for $40.4 billion, as per the Associated Press, Warner Bros. seems to have dug in on its opposition to Paramount anyway. So Paramount is seeking an amendment to Warner Bros.’ bylaws, which would require that shareholders approve any plan to separate Warner Bros’ cable TV business from the rest of the business, which Reuters called key to the Netflix deal.
“WBD has provided increasingly novel reasons for avoiding a transaction with Paramount, but what it has never said, because it cannot, is that the Netflix transaction is financially superior to our actual offer,” Paramount wrote in a letter to investors.
“Our $30 per share in cash is simply more than Netflix’s complex multi-variable consideration comprised of (a) $23.25 in cash plus (b) a number of Netflix shares currently worth $4.11 (at Friday’s (January 8, 2026) close) plus (c) the to-be-issued Global Networks equity which we have analyzed as having zero equity value.”
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