PARAMOUNT COMMENTS ON WARNER BROS. DISCOVERY BOARD'S DETERMINATION OF PARAMOUNT'S PROPOSAL AS SUPERIOR
MWN-AI** Summary
On February 26, 2026, Paramount Skydance Corporation confirmed receipt of notification from Warner Bros. Discovery, Inc. (WBD) that its Board of Directors has classified Paramount's $31 per share, all-cash acquisition proposal as a "Company Superior Proposal." This designation indicates that Paramount's offer exceeds the current merger agreement between WBD and Netflix, Inc.
David Ellison, Chairman and CEO of Paramount, expressed satisfaction with WBD's decision, noting its affirmation of the offer's superior value, which provides WBD shareholders with enhanced certainty and expedience in closing. Paramount's proposal entails significant financial commitments, including a $31 cash offer for each WBD share, a daily "ticking fee" of $0.25 accruing post-September 30, 2026, regulatory costs covered by a significant termination fee of $7 billion, among other benefits. Notably, Paramount is also prepared to pay WBD's required $2.8 billion termination fee to Netflix, further simplifying WBD's financial obligations.
The acquisition process is governed by a four-business-day match period, after which Paramount's proposal can advance, contingent on the termination of the WBD-Netflix agreement and the execution of a definitive merger agreement. Paramount has reinforced its financial viability through a substantial equity commitment of $45.7 billion from the Ellison Trust, with guarantees by Larry Ellison and a debt commitment of $57.5 billion from major financial institutions.
As this transaction unfolds, it underscores Paramount's strategic ambitions in the competitive media landscape. The approval of the acquisition will depend on navigating regulatory scrutiny and ensuring stakeholder buy-in, particularly in light of WBD's existing arrangement with Netflix. Paramount remains optimistic about the benefits this acquisition could deliver across its expansive entertainment portfolio.
MWN-AI** Analysis
Paramount Skydance Corporation's recent move to acquire Warner Bros. Discovery, Inc. (WBD) at $31 per share may signal a pivotal moment in the competitive landscape of media and entertainment. As Paramount has been deemed to have made a "Company Superior Proposal," investors should assess both immediate implications and longer-term consequences of this acquisition.
Paramount is positioning itself as a stronger contender against key players like Netflix, acknowledging the need for greater scale and content diversification in a rapidly evolving market. The proposed acquisition will not only provide Paramount with WBD's extensive library but also enhance its offerings in streaming, television, and film—critical areas in an increasingly competitive environment.
Moreover, the deal's structure demonstrates financial commitment and strategic foresight: a $7 billion regulatory termination fee and a significant commitment of $57.5 billion in debt indicate that Paramount is prepared to navigate potential hurdles to close this deal. Investors should consider the implications of these financial maneuvers, especially regarding Paramount's debt levels. While leveraging can increase potential returns, it also introduces risk, particularly if integration yields slower-than-expected synergies or operational disruptions.
The growing emphasis on streaming suggests a pivotal shift for both companies. As traditional media faces pressures from digital platforms, Paramount’s acquisition presents both risks and opportunities. Successful integration could drive enhanced subscriber growth and content performance across its ecosystems, streamlining operations and cost efficiencies.
In summary, this acquisition is a strategic play by Paramount to solidify its positioning in a competitive market. Investors should monitor developments closely, particularly regarding execution risks and market reactions. Additionally, the broader implications for the media landscape and competition dynamics may affect stock valuations in the near future, making this a crucial period for stakeholders.
**MWN-AI Summary and Analysis is based on asking OpenAI to summarize and analyze this news release.
PR Newswire
LOS ANGELES and NEW YORK, Feb. 26, 2026 /PRNewswire/ -- Paramount Skydance Corporation (NASDAQ: PSKY) ("Paramount") confirms that it has been notified by Warner Bros. Discovery, Inc. (NASDAQ: WBD) ("WBD") that WBD's Board of Directors has determined that Paramount's $31 per share, all-cash proposal to acquire WBD is a "Company Superior Proposal" under the terms of WBD's merger agreement with Netflix, Inc. (NASDAQ: NFLX).
David Ellison, Chairman and CEO of Paramount, said: "We are pleased WBD's Board has unanimously affirmed the superior value of our offer, which delivers to WBD shareholders superior value, certainty and speed to closing."
Under the terms of Paramount's proposed merger agreement:
- Paramount will acquire WBD for $31.00 per WBD share in cash for 100% of the company;
- A daily "ticking fee" of $0.25 per quarter will accrue after September 30, 2026, until the consummation of the Paramount transaction;
- A regulatory termination fee of $7 billion would be payable in the event the transaction does not close due to regulatory matters;
- Paramount will pay the $2.8 billion termination fee which WBD is required to pay to Netflix to terminate its existing Netflix merger agreement;
- Paramount will eliminate WBD's potential $1.5 billion financing cost associated with its debt exchange offer;
- The "Company Material Adverse Effect" definition excludes the performance of WBD's Global Linear Networks business;
- The Ellison Trust is providing a $45.7 billion equity commitment, and Larry Ellison is guaranteeing such commitment, including an obligation to contribute additional equity funding to Paramount to the extent needed to support the solvency certificate required by Paramount's lending banks, and
- Bank of America Merrill Lynch, Citi and Apollo are providing a $57.5 billion debt commitment.
The entry into Paramount's proposed transaction requires the expiration of a four business day match period, termination of the Netflix merger agreement and execution of a definitive merger agreement between Paramount and WBD.
As previously announced, the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act applicable to Paramount's acquisition of WBD expired at 11:59 pm on February 19, 2026.
Centerview Partners LLC and RedBird Advisors are acting as lead financial advisors to Paramount, and Bank of America Securities, Citi, M. Klein & Company and LionTree are also acting as financial advisors. Cravath, Swaine & Moore LLP and Latham & Watkins LLP are acting as legal counsel to Paramount.
About Paramount, a Skydance Corporation
Paramount, a Skydance Corporation (Nasdaq: PSKY) is a leading, next generation global media and entertainment company, comprised of three business segments: Studios, Direct-to-Consumer, and TV Media. The Company's portfolio unites legendary brands, including Paramount Pictures, Paramount Television, CBS – America's most-watched broadcast network, CBS News, CBS Sports, Nickelodeon, MTV, BET, Comedy Central, Showtime, Paramount+, Pluto TV, and Skydance's Animation, Film, Television, Interactive/Games, and Sports divisions. For more information please visit www.paramount.com.
Cautionary Note Regarding Forward-Looking Statements
This communication contains both historical and forward-looking statements, including statements related to Paramount Skydance Corporation's ("Paramount") future financial results and performance, potential achievements, anticipated reporting segments and industry changes and developments. All statements that are not statements of historical fact are, or may be deemed to be, "forward-looking statements". Similarly, statements that describe Paramount's objectives, plans or goals are or may be forward-looking statements. These forward-looking statements reflect Paramount's current expectations concerning future results and events; generally can be identified by the use of statements that include phrases such as "believe," "expect," "anticipate," "intend," "plan," "foresee," "likely," "will," "may," "could," "estimate" or other similar words or phrases; and involve known and unknown risks, uncertainties and other factors that are difficult to predict and which may cause Paramount's actual results, performance or achievements to be different from any future results, performance or achievements expressed or implied by these statements. These risks, uncertainties and other factors include, among others: the outcome of the tender offer by Paramount and Prince Sub Inc. (the "Tender Offer") to purchase for cash all of the outstanding Series A common stock of Warner Bros. Discovery, Inc. ("WBD") or any discussions between Paramount and WBD with respect to a possible transaction (including, without limitation, by means of the Tender Offer, the "Potential Transaction"), including the possibility that the Tender Offer will not be successful, that the parties will not agree to pursue a business combination transaction or that the terms of any such transaction will be materially different from those described herein; the conditions to the completion of the Potential Transaction or the previously announced transaction between WBD and Netflix, Inc. ("Netflix") pursuant to the Agreement and Plan of Merger, dated December 4, 2025, among Netflix, Nightingale Sub, Inc., WBD and New Topco 25, Inc. (the "Proposed Netflix Transaction"), including the receipt of any required stockholder and regulatory approvals for either transaction, the proposed financing for the Potential Transaction, the indebtedness Paramount expects to incur in connection with the Potential Transaction and the total indebtedness of the combined company; the possibility that Paramount may be unable to achieve expected synergies and operating efficiencies within the expected timeframes or at all and to successfully integrate the operations of WBD with those of Paramount, and the possibility that such integration may be more difficult, time-consuming or costly than expected or that operating costs and business disruption (including, without limitation, disruptions in relationships with employees, customers or suppliers) may be greater than expected in connection with the Potential Transaction; risks related to Paramount's streaming business; the adverse impact on Paramount's advertising revenues as a result of changes in consumer behavior, advertising market conditions and deficiencies in audience measurement; risks related to operating in highly competitive and dynamic industries, including cost increases; the unpredictable nature of consumer behavior, as well as evolving technologies and distribution models; risks related to Paramount's decisions to make investments in new businesses, products, services and technologies, and the evolution of Paramount's business strategy; the potential for loss of carriage or other reduction in or the impact of negotiations for the distribution of Paramount's content; damage to Paramount's reputation or brands; losses due to asset impairment charges for goodwill, intangible assets, FCC licenses and content; liabilities related to discontinued operations and former businesses; increasing scrutiny of, and evolving expectations for, sustainability initiatives; evolving business continuity, cybersecurity, privacy and data protection and similar risks; content infringement; domestic and global political, economic and regulatory factors affecting Paramount's businesses generally, including tariffs and other changes in trade policies; the inability to hire or retain key employees or secure creative talent; disruptions to Paramount's operations as a result of labor disputes; the risks and costs associated with the integration of, and Paramount's ability to integrate, the businesses of Paramount Global and Skydance Media, LLC successfully and to achieve anticipated synergies; volatility in the prices of Paramount's Class B Common Stock; potential conflicts of interest arising from Paramount's ownership structure with a controlling stockholder; and other factors described in Paramount's news releases and filings with the Securities and Exchange Commission (the "SEC"), including but not limited to Paramount Global's most recent Annual Report on Form 10-K and Paramount's reports on Form 10-Q and Form 8-K. There may be additional risks, uncertainties and factors that Paramount does not currently view as material or that are not necessarily known. The forward-looking statements included in this communication are made only as of the date of this report, and Paramount does not undertake any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances.
Additional Information
This communication does not constitute an offer to buy or a solicitation of an offer to sell securities. This communication relates to a proposal that Paramount has made for an acquisition of WBD, the Tender Offer that Paramount, through Prince Sub Inc., its wholly owned subsidiary, has made to WBD stockholders, and Paramount's intention to solicit proxies against the Proposed Netflix Transaction and other proposals to be voted on by WBD stockholders at the special meeting of WBD stockholders to be held to approve the Proposed Netflix Transaction (the "Netflix Merger Solicitation") and/or for use at the WBD annual meeting of stockholders. The Tender Offer is being made pursuant to a tender offer statement on Schedule TO (including the offer to purchase, the letter of transmittal and other related offer documents), filed with the SEC on December 8, 2025. These materials, as may be amended from time to time, contain important information, including the terms and conditions of the offer. Subject to future developments, Paramount (and, if a negotiated transaction is agreed, WBD) may file additional documents with the SEC. This communication is not a substitute for any proxy statement, tender offer statement, or other document Paramount and/or WBD may file with the SEC in connection with the Potential Transaction.
Paramount, Prince Sub Inc. and the other participants in the Netflix Merger Solicitation have filed a preliminary proxy statement and the accompanying BLUE proxy card with the SEC on January 22, 2026 in connection with the Netflix Merger Solicitation (the "Special Meeting Preliminary Proxy Statement"). Paramount expects to file a definitive proxy statement and the accompanying proxy card with the SEC in connection with the Netflix Merger Solicitation and may file other proxy solicitation materials in connection therewith or the annual meeting of WBD stockholders, or other documents with the SEC.
PARAMOUNT STRONGLY ADVISES ALL STOCKHOLDERS OF WBD TO READ THE SPECIAL MEETING PRELIMINARY PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION, INCLUDING INFORMATION RELATED TO THE PARTICIPANTS. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC'S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, PARAMOUNT AND THE OTHER PARTICIPANTS IN SUCH PROXY SOLICITATIONS WILL PROVIDE COPIES OF THE APPLICABLE PROXY STATEMENTS WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR SUCH COPIES SHOULD BE DIRECTED TO THE APPLICABLE PROXY SOLICITOR.
Participants in the Solicitation
The participants in the Netflix Merger Solicitation are expected to be Paramount, Prince Sub Inc., certain directors and executive officers of Paramount and Prince Sub Inc., Lawrence Ellison, RedBird Capital Management and The Lawrence J. Ellison Revocable Trust, u/a/d 1/22/88, as amended. Additional information about the participants in the Netflix Merger Solicitation is available in the Special Meeting Preliminary Proxy Statement.
PSKY-IR
Media Contacts:
Paramount
Melissa Zukerman / Laura Watson
msz@paramount.com / laura.watson@paramount.com
Brunswick Group
ParamountSkydance@brunswickgroup.com
Gagnier Communications
Dan Gagnier
dg@gagnierfc.com
Investor Contacts:
Paramount
Kevin Creighton / Logan Thomas
kevin.creighton@paramount.com / logan.thomas@paramount.com
Okapi Partners
(212) 297-0720
Toll-Free: (844) 343-2621
info@okapipartners.com
SOURCE Paramount Skydance Corporation
FAQ**
How does Paramount Skydance Corporation (PSKY) plan to finance the acquisition of Warner Bros. Discovery (WBD), given the $45.7 billion equity commitment and $57.5 billion debt commitment mentioned in the announcement?
What strategies will Paramount Skydance Corporation (PSKY) employ to ensure a smooth integration of WBD’s operations and to achieve the anticipated synergies post-merger?
With the $2.8 billion termination fee required to exit the Netflix merger agreement, how does Paramount Skydance Corporation (PSKY) justify this cost in the context of the overall strategic benefits from acquiring WBD?
How does Paramount Skydance Corporation (PSKY) plan to mitigate the risks associated with regulatory challenges or potential consumer behavior shifts in the highly competitive media landscape following this acquisition of WBD?
3. Can Paramount provide more insights into how the “Company Material Adverse Effect” definition will impact Warner Bros. Discovery Inc. (WBD) during the acquisition process?
4. What are the key strategic advantages that Paramount anticipates gaining by acquiring Warner Bros. Discovery Inc. (WBD) and integrating its operations?
**MWN-AI FAQ is based on asking OpenAI questions about Warner Bros. Discovery Inc. (NASDAQ: WBD).
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