Warner Bros. Discovery Board Evaluates Revised Proposal from Paramount Skydance As Potential Superior Offer

Warner Bros. Discovery's Board Reviews Proposal from Paramount Skydance

Warner Bros. Discovery, Inc. (commonly referred to as WBD) has recently made headlines as its Board of Directors deliberates a revised proposal from Paramount Skydance Corporation (PSKY). This evaluation arrives amid WBD's continued commitment to its existing merger agreement with Netflix, Inc.

In a public statement released on February 24, 2026, WBD outlined the terms of the revised proposal put forth by PSKY. The proposal offers an increased purchase price of $31.00 per share in cash, along with a daily ticking fee of $0.25 per quarter, which will take effect after September 30, 2026. Additionally, this revised offer includes a hefty regulatory termination fee of $7 billion, which would be payable by PSKY if the transaction fails to close due to regulatory hurdles. Furthermore, the proposal accounts for a $2.8 billion termination fee that WBD would owe to Netflix if they opt to terminate their existing merger agreement.

The Board has yet to determine whether this new proposal from PSKY is indeed superior to the planned merger with Netflix. There are complex considerations at play, especially since a formal definition of what constitutes a 'Company Superior Proposal' is outlined in WBD's existing agreement with Netflix. Should WBD's Board decide that such a superior proposal has been received, Netflix would then have four business days to negotiate and possibly amend their transaction terms.

Key stakeholders and analysts are closely watching these developments, given that the entertainment landscape is highly competitive and fluid. Warner Bros. Discovery is known for its extensive portfolio of franchises and brands, which include HBO Max, CNN, and various streaming and linear networks. The implications of this potential switch in strategic direction could have significant ramifications for all parties involved.

WBD's management, after consulting with financial and legal advisors, acknowledges the importance of this moment. Allen Company, J.P. Morgan, and Evercore are serving in advisory roles, while the legal intricacies are being navigated by Wachtell Lipton, Rosen & Katz, and Debevoise & Plimpton LLP. This level of expertise indicates the seriousness with which the Board is approaching this proposal.

While it remains to be seen whether PSKY's offer will ultimately lead to a shift in WBD's strategic direction, the Board continues to back the merger with Netflix as of now. The possibility that PSKY’s proposal could lead to superior outcomes continues to fuel speculation, particularly among investors.

What Could LIE Ahead?

Warner Bros. Discovery is at a critical juncture, balancing stakeholder interests while navigating complex regulatory environments. The merger agreement with Netflix remains intact, and the company has not rescinded its endorsement of the transaction.

This situation underscores the volatile nature of mergers and acquisitions in the media and entertainment industry, where strategic maneuvers can significantly alter company destinies. As the landscape evolves, all eyes will be on how this potential offer from Paramount Skydance develops in the coming weeks.