Paramount has upgraded its bid to acquire Warner Bros. Discovery (WBD) without increasing the headline per‑share price, instead adding a suite of financial sweeteners designed to reduce deal uncertainty and blunt the appeal of WBD’s competing agreement with Netflix. The new package includes a quarterly “timing fee” of $0.25 per share that will begin in early 2027 and translate to roughly $650 million in cash each quarter until a transaction closes. Paramount also pledged to absorb the roughly $2.8 billion break‑up fee WBD would owe Netflix should that tie‑up collapse, and increased the personal guarantee provided by Oracle co‑founder Larry Ellison to $43.3 billion.
Paramount has kept its headline offer at $30 per share, valuing the combined enterprise at about $108.4 billion including debt, and plans to fund the deal with roughly $54 billion of debt financing arranged by Bank of America, Citi and Apollo. The company said it would guarantee WBD’s planned debt exchange to remove a potential $1.5 billion cash risk to bondholders and would give WBD the same transitional operational autonomy that Netflix has promised in its agreement. Wall Street reacted with mild enthusiasm: WBD shares rose about 1.9%, Netflix climbed 2.3% and Paramount gained 1.5% on the announcement.
Analysts greeted the move as a tactical escalation rather than a final offer: Paramount is signaling confidence that Netflix’s proposed acquisition of WBD’s studios and streaming assets — valued at roughly $82.7 billion — could stumble under regulatory scrutiny. By offering to cover the breakup fee and to pay a recurring cash allowance to shareholders while a deal languishes, Paramount is attempting to message cash certainty and a clearer regulatory path. Yet several market observers said those incentives may not be enough to persuade shareholders to abandon a higher immediate payout from Netflix should regulators give it the green light.
The strategic stakes are high. WBD owns top‑tier film and television studios and a vast content library including Game of Thrones, the Harry Potter franchise and DC’s Batman and Superman, all of which would be transformational assets for a streaming platform. For Netflix, winning those properties would accelerate its move from a pure distribution service into the dominant global studio‑content owner, potentially lifting its audience scale toward half a billion users and deepening its catalogue for spin‑offs, prequels and franchise extensions.
Regulatory risk is the fulcrum of Paramount’s gambit. U.S. antitrust authorities — and other competition agencies — are scrutinising whether Netflix’s proposed purchase would diminish competition in content production and streaming. Paramount’s pitch is effectively a bet that regulators will balk at a combined Netflix‑WBD that concentrates too much production muscle and intellectual property under one streaming leader, creating an opening for a rival buyer with a supposedly smoother path to approval. That calculus, however, is speculative: regulators can approve, block, or require remedies that reshape the economics of any deal.
If successful, Paramount’s approach would reset how bidders structure offers in high‑stakes media mergers: headline price would no longer be the only variable for shareholders to weigh. By purchasing optionality — through a steady cash stream and a promise to pick up breakup costs — Paramount is buying time and psychological leverage. But the move also raises questions about leverage and execution risk: a $54 billion debt package and large personal guarantees expose buyers and financiers to heavy balance‑sheet risk if the market or regulatory environment shifts before a closing.