Warner Bros reopens takeover talks with Paramount after receiving a
waiver from Netflix
[February 18, 2026] By
MICHELLE CHAPMAN and WYATTE GRANTHAM-PHILIPS
NEW YORK (AP) — Warner Bros. Discovery is briefly reopening takeover
talks with Skydance-owned Paramount to hear the company's “best and
final” offer, while the Hollywood giant continues to back the studio and
streaming deal it struck with Netflix.
In a Tuesday regulatory filing, Warner said it had received a waiver
from Netflix to reopen talks with Paramount for the next seven days, or
until Monday. Warner said this will allow the companies to discuss
unresolved “deficiencies” and “clarify certain terms” of Paramount's
latest bid.
But in the meantime, Warner's board is still recommending shareholders
support of its proposed merger with Netflix. A special meeting is now
scheduled for Friday, March 20 to hold a vote on that deal.
In a statement, Netflix said it was confident that its proposed
transaction “provides superior value and certainty” — but recognized
“the ongoing distraction for WBD stockholders and the broader
entertainment industry caused by PSKY’s antics.” The streaming giant
noted it had granted Warner a seven-day waiver to “finally resolve this
matter.”
Warner's leadership similarly reiterated its support for the Netflix
deal.
Meanwhile, Paramount called Tuesday's actions from Warner's board
“unusual” and said the company could have determined whether Paramount's
offer was superior without a timed deadline. Still, Paramount said it
was “nonetheless prepared to engage in good faith and constructive
discussions."
Paramount added that it will continue to advance its tender offer priced
at $30 per share, which it maintained was better than Netflix's
proposal, while also pursuing a proxy fight.
The battle for Warner Bros. Discovery is complicated because Netflix and
Paramount want different things. In December, Netflix agreed to buy
Warner’s studio and streaming business for $72 billion, now in an
all-cash transaction that would cover its legacy TV and movie production
arms, as well as HBO Max. Including debt, the enterprise value of the
deal is about $83 billion, or $27.75 per share, and would be finalized
after Warner completes a previously-announced separation of its cable
operations.
Meanwhile, unlike Netflix, Paramount wants to acquire Warner’s entire
company — including networks like CNN and Discovery — and went straight
to shareholders with an all-cash, $77.9 billion hostile offer just days
after the Netflix deal was announced.
The enterprise value of Paramount's bid currently stands around $108
billion including debt, or $30 per share. But Warner disclosed Tuesday
that a Paramount representative separately informed the company it would
up its offer to $31 per share “pending engagement.”
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The Warner Bros. water tower is seen at Warner Bros. Studios in
Burbank, Calif., Dec. 5, 2025. (AP Photo/Jae C. Hong, File)
 Analysts at Raymond James said they
had “long believed” Paramount was willing to raise its offer “and
now it seems we are finally moving in that direction.” If Paramount
were to up its price to $32 or $33 per share, they noted it would be
“increasingly difficult to argue the Netflix agreement is superior,"
although Netflix could then move to match the bid.
“Netflix is still in the driver’s seat, but now having to make its
case,” the analysts added in a Tuesday research note.
Paramount has made more attempts to sweeten its offer recently. Last
week, the company said it would pay Warner shareholders an added
“ticking fee” if its deal doesn’t go through by the end of the year
— amounting to 25 cents per share, or a total of $650 million, for
every quarter after Dec. 31. Paramount also pledged to fund Warner’s
proposed $2.8 billion breakup payout to Netflix under its merger
agreement.
The company has been scrambling to solidify more shareholder
support. Paramount has extended its tender offer three times, with
the latest deadline set for March 2. According to company
disclosures, more than 42.3 million Warner shares had been “validly
tendered and not withdrawn” from its hostile bid as of the start of
last week, down from over 168.5 million Warner shares on Jan. 21 —
still a small fraction of Warner's 2.48 billion shares outstanding
in series A common stock.
But also last week, one activist investor, Ancora Holdings, publicly
expressed opposition to Warner's proposed merger with Netflix. And
beyond its tender offer, Paramount has also promised a proxy fight.
On Tuesday, the company reiterated plans to nominate its own slate
of directors at Warner's upcoming annual meeting.
What, if anything, changes after the next seven days of talks has
yet to be seen. Paramount, Warner and Netflix have spent the last
couple of months in a heated back and forth over who has a stronger
deal on the table.
The prospect of a Warner sale to either company has raised
tremendous antitrust concerns from lawmakers worldwide, who are
calling on regulators to carefully scrutinize a merger of this size.
The U.S. Department of Justice has already initiated its reviews,
and other countries may also scrutinize either deal. Both Paramount
and Netflix have said they received securities clearance from German
authorities last month.
Shares of Warner Bros. Discovery rose more than 3% in Tuesday
trading. Paramount Skydance climbed over 5%, while Netflix's stock
inched up slightly.
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