Warner Bros reopens Paramount bid talks amid Netflix deal

Warner Bros Discovery has reopened takeover discussions with Skydance-owned Paramount after receiving a seven-day waiver from Netflix, even as it continues to recommend shareholders back its proposed merger with the streaming giant.

In a regulatory filing on Tuesday, Warner said the waiver allows it to engage with Paramount to discuss unresolved 'deficiencies' and 'clarify certain terms' of Paramount’s latest bid. The window for talks will remain open until Monday.

Despite reopening discussions, Warner’s board reiterated its recommendation that shareholders vote in favour of the Netflix transaction. A special meeting to vote on the proposed merger is scheduled for March 20.

In a statement, Netflix said it was confident that its proposed transaction 'provides superior value and certainty' but recognised 'the ongoing distraction for WBD stockholders and the broader entertainment industry caused by PSKY’s antics.' The company said it had granted the waiver to 'finally resolve this matter.'

Paramount described Warner’s move as 'unusual', stating that the board could have assessed the superiority of its offer without imposing a timed deadline. The company added it was 'nonetheless prepared to engage in good faith and constructive discussions.' Paramount is continuing its tender offer priced at $30 per share and has indicated it may increase the bid to $31 per share pending engagement.

The competing bids reflect differing strategies. Netflix agreed in December to acquire Warner’s studio and streaming business in an all-cash deal valued at $72 billion, with an enterprise value of around $83 billion including debt. Paramount, by contrast, is pursuing an acquisition of Warner’s entire company, including networks such as CNN and Discovery, through an all-cash hostile offer valued at approximately $108 billion including debt.

Analysts have noted that further increases in Paramount’s bid could intensify pressure on Warner’s board to reassess the Netflix agreement. Meanwhile, regulatory scrutiny remains likely, with the US Department of Justice already reviewing the proposed transactions.

Shares of Warner Bros Discovery rose more than 3% in Tuesday trading, while Paramount gained over 5% and Netflix edged up slightly.