The Warner Bros. Discovery board of directors has rejected another bid from Paramount Skydance to acquire the company.
The rejection was expected, as Paramount presented the same all-cash terms as its initial offer of $30 per share in mid-December.
Last week, reports surfaced that the Warner Bros. Discovery planned to turn down the renewed offer, which had now featured a personal guarantee from billionaire Larry Ellison, who pledged $40.4 billion in equity financing and related commitments to support the deal. Ellison, along with his son David, controls Paramount Skydance after taking over the company in August.
According to the reporting, board members are uneasy about how much control the Ellisons would exert over Warner Bros. Discovery’s debt management under a Paramount-led transaction.
In addition, Paramount has not committed to covering the breakup fee Warner Bros. Discovery would owe Netflix if it were to abandon that deal.
Netflix and Warner Bros. Discovery reached a tentative deal in early December for a similar $30-per-share offer proposed by Paramount Skydance. However, part of that deal includes a $5 billion fee should the deal ultimately not come to fruition.
The WBD board shared that its shareholders could see “substantial upside” from receiving shares of Netflix stock as part of the acquisition, noting that Paramount would be part of the largest leveraged buyout in history should it accept the offer from that company.
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