Paramount sues Warner Bros. Discovery, challenges $83B Netflix deal with proxy fight
Paramount has taken its takeover bid for Warner Bros. Discovery to court, suing in Delaware for more financial disclosure on WBD’s $83 billion Netflix deal. CEO David Ellison says shareholders lack key details to judge the offer and claims Paramount’s $30-per-share cash bid is stronger. With WBD rejecting the offer, Paramount is preparing a proxy fight, pushing for board changes and a shareholder vote.
Paramount has taken its fight with Warner Bros. Discovery to the courtroom as the battle over the company’s future heats up.
On Monday, Paramount CEO David Ellison said the company has filed a lawsuit in Delaware demanding more financial details from Warner Bros. Discovery about its deal with Netflix. At the same time, Paramount is preparing for a proxy fight, planning to nominate its own directors to WBD’s board in an effort to block the Netflix agreement.
Warner Bros. Discovery agreed in December to sell its TV and movie studios to Netflix in a deal valued at $83 billion. Paramount, however, believes its $30-per-share all-cash offer is better for shareholders and says WBD’s board has not been transparent about how it evaluated the Netflix proposal.
Ellison said Paramount has repeatedly asked for clearer information on how Warner Bros. Discovery valued the Netflix deal, including how debt and a planned Global Networks spinoff factor into the final numbers. According to Paramount, that information has not been shared, making it hard for shareholders to judge which deal truly offers more value.
Because WBD’s board has rejected Paramount’s bid so far, the decision may now come down to a shareholder vote. Paramount plans to push for changes at the board level and wants shareholder approval to be required for any breakup of WBD’s Global Networks business.
“These actions, coupled with our tender offer, ensure that you get the final decision on which offer is better for you,” Ellison said in a letter sent to shareholders.
Paramount says it would still prefer a negotiated deal and remains open to talks with Warner Bros. Discovery. “Our goal remains to have constructive discussions with WBD’s Board,” Ellison said.
Until then, the fight will continue on two fronts: one in court and another among shareholders, as Paramount continues its push to take control of Warner Bros. Discovery.