Lights, Camera, Lawsuits! The inaugural edition of our M&A and Corporate newsletter dives into the ongoing drama between Netflix, Warner Bros. Discovery, and Paramount, and breaks down how business owners can flip the script to benefit their own business deals.
In 2025, media giant Warner Bros. Discovery (WBD) began exploring deals to sell. With an IP library full of properties including Game of Thrones, Harry Potter, and DC Comics, the offers came flooding in from competitors looking to acquire ownership of the studios and their highly bingeable content. Following several rounds of bidding, WBD cast Netflix as the winning bidder, earning the part over rivals such as Paramount, Amazon, and Comcast.
In December, WBD and Netflix officially announced their agreement for the home streaming giant to acquire WBD’s studios and HBO/HBO Max assets while spinning off cable network channels such as CNN, TNT, and Discovery into a separate company, “Discovery Global.” Netflix announced it expected the deal to close in 12 to 18 months, following Discovery Global’s spinoff and pending regulatory approval. The original deal was for a mix of cash and stock, with a total combined value of approximately $82.7 billion.
Enter jilted bidder Paramount, which immediately pulled its own plot twist and attempted a hostile takeover by announcing an all-cash counteroffer for all of WBD, including its network channels, with a total reportedly higher than the Netflix deal. Paramount claims that its proposal was a better value for shareholders, but WBD asserted that the Paramount deal is riskier and less structurally sound than the one from Netflix. WBD’s board rejected Paramount’s offer, and the company responded by filing various lawsuits requesting details about the Netflix deal and threatening a proxy battle. Paramount shared its plans to nominate Paramount-sympathetic representatives for WBD’s board at an upcoming election to sway the voting in favor of Paramount’s counteroffer.
In response to the repeated incursions from Paramount, just this week Netflix revised its offer to also be all cash, dropping the stock component while keeping the deal valued at the already whopping ~$82.7 billion. The change was unanimously supported by WBD’s board. By removing the stock component, the deal may be up for a vote with shareholders as early as April 2026, potentially accelerating the acquisition timeline.
The final deal is far from over – WBD and Netflix will still face antitrust scrutiny in the already narrow streaming market, shareholder approval following the flurry of national news surrounding the companies, and the successful separation of Discovery Global.
As for Paramount? It is a cliffhanger for now, but stay tuned – Hollywood loves a sequel.
What Can Businesses Learn From This?
While most companies will not be the star of a bidding war, there are several lessons that business owners can take away for their own next act:
Options = Leverage. Despite the extra drama, Paramount’s pursuit of WBD has elevated Netflix’s (already preferred) cash and stock offer into an even more stable all-cash offer. Businesses looking to sell should be prepared to review multiple offers to ensure they get the best value for their business.
Keep the controlling parties aligned. Despite the flurry of bids, lawsuits, and news stories over the past few months, WBD’s board has remained a united front and controlled the narrative surrounding the deal. Avoiding division among the leadership can help avoid costly and time-consuming speedbumps when executing a deal, even without a global audience.
Deals Can Take Time – Control What You Can and Plan Ahead. Assuming Netflix’s acquisition clears its regulatory hurdles, the sale will still not be complete for at least a year. To avoid any additional delays, both companies have enlisted experienced advisors to facilitate the deal and help it proceed as smoothly as possible. Getting your legal and financial team in place and aligned before exploring a M&A transaction can help avoid expensive delays when negotiating a closing, regardless of whether you are the buyer or seller.
Have questions about how to make your company the star of an M&A deal? Contact M&A and Corporate lead Connie Phelps at cphelps@berenzweiglaw.com