Paramount Skydance has filed a lawsuit against Warner Bros Discovery, seeking disclosure of financial details regarding Netflix’s $82.7 billion deal. The legal move marks a significant escalation in the ongoing competition for control of one of Hollywood’s most iconic studios.
The lawsuit was filed in the Delaware Court of Chancery. Paramount is requesting the Warner Bros board reveal its financial analysis supporting the Netflix merger.
Boardroom Battle Intensifies
Paramount has announced plans to nominate directors to Warner Bros’ board, signaling aggressive efforts to convince investors that its $108.7 billion all-cash bid surpasses Netflix’s combined cash-and-stock offer.
The Warner Bros content library, which includes Harry Potter and the DC Comics universe, remains a major point of contention. Paramount argues its cash-only bid of $30 per share is financially superior to Netflix’s $27.75 per share offer, which also includes streaming assets.
Shareholder Strategy and Bylaw Proposal
Paramount also intends to propose a bylaw amendment requiring shareholder approval for any separation of Warner Bros’ cable TV business. The company claims the cable spinoff is nearly worthless and that its bid would face fewer regulatory obstacles.
In addition, Paramount emphasizes that disclosure of Warner Bros’ analysis is essential for shareholders considering whether to tender shares before Paramount’s offer expires on January 21.
Financial Stakes and Escalating Tensions
Warner Bros has warned it may owe Netflix a $2.8 billion termination fee if the agreement is abandoned. Overall, ending the Netflix deal could cost the studio $4.7 billion.
Paramount’s amended offer includes $40 billion in equity personally guaranteed by Oracle co-founder Larry Ellison and $54 billion in debt, demonstrating strong financial backing.
The company criticized Warner Bros for avoiding a direct comparison of the two bids, arguing the board has yet to demonstrate Netflix’s deal as financially superior.
Analyst Perspectives and Next Steps
Experts suggest the lawsuit may take significant time to resolve and may not immediately affect the takeover process. Analysts urge Paramount to consider increasing its bid to strengthen its position.
Paramount maintains that timing is critical. The lawsuit emphasizes the urgency for shareholder decisions and possible extension of the offer deadline.
Warner Bros’ Response
Warner Bros dismissed the lawsuit as “meritless”, asserting that Paramount has neither raised its offer price nor addressed apparent deficiencies. Netflix has not commented publicly on the ongoing litigation.
Conclusion: A High-Stakes Hollywood Showdown
The Paramount-Warner Bros conflict highlights a fierce battle for control of a historic Hollywood studio. With billions at stake, shareholder votes, legal actions, and competing financial strategies are shaping a high-profile corporate drama.
The outcome could redefine ownership and influence in Hollywood, setting a precedent for future media mergers.
