Paramount Skydance announced its intent to nominate its own candidates to the Warner Bros. Discovery board of directors to prevent its merger with the streaming service Netflix, and has sued the film studio, reports The New York Times.
In the lawsuit, the firm headed by David Ellison demands that Warner Bros. reveal detailed information as to why its management deemed the Netflix offer to acquire the company for $82.7 billion more advantageous.
Paramount spent four months attempting to purchase the Hollywood studio and submitted several bids, but all were rejected by the Warner Bros. board, notes Bloomberg. Ellison’s company insists that its offer is more beneficial: $30 per share in cash versus $27.75 per share from Netflix. Paramount suggests repurchasing the entirety of Warner Bros. Discovery, including its assets and television networks like CNN and TNT Sports, rather than just the studio and HBO.
In a letter to shareholders, Ellison stated that he will challenge the Netflix deal either at the next annual meeting of Warner Bros. shareholders or at a special session convened for its approval. “We are determined to complete our tender offer,” the letter reads.
Warner Bros. deemed Paramount’s lawsuit unfounded, and its filing an attempt to divert investor attention. Its statement says that Ellison’s company “has yet to raise its price or remedy the numerous and apparent deficiencies of its proposal” to acquire WBD entirely. “Paramount Skydance continues to propose a transaction that, in the unanimous judgment of our board members, does not surpass the merger agreement with Netflix,” Warner Bros. believes.
Netflix announced in early December that it had reached an agreement to purchase the Warner Bros. studio. The potential transaction generated a mixed reaction in Hollywood, and President Donald Trump stated his intention to participate in its discussion. On January 11, he shared an article on Truth Social titled “Stop the Netflix Cultural Takeover,” which argues that the U.S. Department of Justice and the Federal Trade Commission should view the Netflix and WBD merger “as the primary antitrust priority—not only because of its market implications but also because of what it signifies for free expression and cultural pluralism in America.”
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