WBD Board Backs Paramount Skydance's Revised Proposal at $31 Per Share

Warner Bros. Discovery’s board of directors has signaled support for a restructured acquisition proposal from Paramount Skydance, marking a significant development in the ongoing merger negotiations. The latest proposal quotes a purchase price of $31 per WBD share in cash, supplemented by a quarterly ticking fee of $0.25 beginning after September 30. This move opens a new chapter in a complex three-way corporate negotiation involving Warner Bros. Discovery, Paramount Skydance, and Netflix, with the Netflix merger agreement remaining the standing transaction.

Financial Architecture of the Restructured Proposal

The proposal framework includes several substantial financial components designed to address WBD shareholders’ interests and existing obligations. The $31 per-share offer represents a cash acquisition price, with the added ticking fee mechanism providing continuing value through the deal closure period.

Paramount Skydance has committed to a $7 billion regulatory failure fee, protecting against deal termination due to antitrust or other government-imposed obstacles. Critically, this proposal covers the $2.8 billion breakup fee that WBD would owe Netflix to exit its existing merger agreement, addressing the financial bridge necessary to unwind the current transaction.

Enhanced Deal Protections and Risk Mitigation

The revised proposal includes additional safeguards beyond the headline price. Paramount Skydance must provide supplementary equity capital if required to satisfy the solvency certificate demanded by its lending syndicate, ensuring financial stability throughout the transaction lifecycle.

Notably, the definition of “Company Material Adverse Effect” has been restructured to exclude performance fluctuations in WBD’s Global Linear Networks division. This carve-out acknowledges the volatility in traditional linear broadcasting while focusing deal certainty on the company’s core operating units. These architectural choices signal sophisticated deal engineering aimed at overcoming previous impediments to transaction completion.

Market Reception and Stock Performance

The market responded with cautious optimism to news of the revised proposal. WBD shares closed regular trading on February 25, 2026, at $29.15, gaining $0.23 or 0.80%, with subsequent after-hours trading pushing the price to $29.16. This modest movement reflects investor wariness regarding the deal’s ultimate outcome.

Paramount Skydance stock demonstrated stronger positive movement, closing at $10.39 (down $0.17 or 1.61% during regular trading) but rebounding to $10.53 in overnight trading for a 1.35% gain. Netflix closed its regular session at $78.04, up $2.02 or 2.66%, reflecting broader positive sentiment around potential market consolidation.

Status of Competing Transaction Structures

The WBD board has not yet concluded that the Paramount Skydance proposal surpasses the Netflix merger in value creation potential. The board continues evaluating the proposal against the existing Netflix transaction framework. Under the Netflix merger agreement, Netflix retains the right to negotiate counter-proposals within four business days of any determination that a superior proposal exists.

The Netflix merger agreement remains operationally active, and the board continues to endorse the Netflix transaction as the standing alternative. This posture allows WBD to maintain negotiating leverage while preserving optionality if the Paramount Skydance proposal quotes materialize into a definitive superior agreement. The coming weeks will determine whether this restructured proposal achieves sufficient momentum to displace the current Netflix arrangement.