Paramount Global Launches Lawsuit Against Warner Bros. Discovery
On Monday, Paramount distributed a shareholder communication outlining its strategy for the $30-per-share cash takeover attempt, according to details from the correspondence.
Paramount CEO David Ellison signed the communication, which underscored the entertainment giant's commitment to pushing the acquisition forward.
The document revealed plans to put forward director candidates for election during WBD's 2026 shareholder gathering while simultaneously mobilizing opposition to the company's pending Netflix deal.
Paramount argued that its "$30 per share in cash is simply more than Netflix's complex multi-variable consideration comprised of $23.25 in cash plus (b) a number of Netflix shares currently worth $4.11 plus the to-be-issued Global Networks equity which we have analyzed as having zero equity value."
The correspondence disclosed that Paramount had initiated litigation in Delaware court, contending that WBD leadership failed to provide adequate transparency regarding valuation metrics and debt arrangements tied to both the Netflix transaction and the Global Networks separation, while insisting this data must reach the public domain to facilitate proper shareholder evaluation.
WBD leadership urges rejection of Paramount bids
Paramount revealed on Dec. 8 that it had submitted a proposal to acquire every outstanding WBD share at $30 each in cash, representing a combined enterprise valuation of $108.4 billion.
Paramount's proposal emerged following Netflix's announcement of its agreement with Warner Bros. Discovery.
Netflix disclosed on Dec. 5 that it had secured a deal with Warner Bros. Discovery to purchase Warner Bros., encompassing its motion picture and television production operations, HBO Max, and HBO, at an equity valuation of $72 billion and total enterprise worth of $82.7 billion.
On Dec. 17, WBD's Board of Directors issued guidance urging stockholders to turn down Paramount's takeover proposal and endorse the arrangement finalized with Netflix.
Paramount responded by modifying its proposal on Dec. 22. The media conglomerate preserved its $30-per-share all-cash bid, while billionaire mogul Larry Ellison provided a personal backing for the $40.4 billion equity component of the financing package.
Last week, WBD's Board of Directors counseled investors to dismiss Paramount's updated acquisition proposal.
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