It appears that the future of Warner Bros. Discovery has reached its most critical moment as the company announced that more than 93 percent of its shareholders had essentially voted against the hostile takeover bid by Paramount Skydance and instead voted in support of an extensive merger deal with Netflix. This was announced by Warner Bros. Discovery on January 22, 2026.
The display of self-confidence is a follow-up to a strategic move by Netflix last week when the media firm altered its original bid to a completely cash-based bid worth $83 billion. By making this bid a completely cash-based bid, Netflix has essentially eliminated Paramount’s greatest strength because shares of this media firm are currently highly volatile.
Deal signals major industry shift
However, at the core of the issue are two very different visions for the future of Warner Bros. Discovery itself. Paramount Skydance, under David Ellison, has reportedly been considering a $108.4 billion bid, or $30 a share, to acquire the entire company in a hostile takeover, effectively consolidating the existing film and television production divisions of Warner Bros., as well as its cable assets, under the existing portfolio of Paramount Pictures. The bid made by Netflix, while lower at $83 billion, or $27.75 a share, is a bid to acquire the film and television production divisions of Warner Bros., as well as HBO and Max, as well as a publicly traded entity that contains the international cable assets of Discovery itself.
Despite the reduction in the amount received by shareholders per share, shareholders have continued to favor the decision made by Netflix. This is due to the fact that shareholders will be able to receive an amount of $27.75 in both cash and shares of the recently incorporated company known as Discovery Global, where CNN, TNT, HGTV, and Food Network, among other popular cable TV stations, will be housed. The shares will be priced between $2.41 and $6.86 each.
In a similar manner, certainty of execution is also playing an equally important role in this regard. Warner Bros. Discovery’s Board of Directors has declined Paramount’s bid proposal on eight different occasions, owing to financing risks as well as regulatory challenges. Netflix’s consideration model, based on an all-cash approach, helped to address these risks to a great extent, owing to Netflix’s high cash reserves, amounting to $20 billion, coupled with $42.2 billion worth of debt financing. Netflix is scheduled to hold a shareholder meeting in April 2026. It is conceivable that the more aggressive strategy of Paramount could be another reason for the erosion of trust.
Just recently, in the month itself, Paramount Skydance filed a lawsuit against the company, as it claimed it was making efforts to compel the company’s board of directors to make further disclosures. However, the offer made by Ellison will be extended until February 20th, 2026. When the spin-off of Discovery Global is approved in April next year, the spin-off will happen in the third quarter of 2026. This will be the end of the era of the company known as ‘Warner Bros. Discovery’ and the beginning of a brand-new chapter in the history of Hollywood under the banner of Netflix.
