Paramount Skydance has escalated its battle with Warner Bros. Discovery (WBD), filing a lawsuit in the Delaware Chancery Court that seeks greater transparency around WBD’s proposed USD 83 billion transaction with Netflix.
The legal move comes as Paramount, led by chairman and chief executive David Ellison, challenges what it describes as insufficient disclosure surrounding the financial mechanics of WBD’s deal with the streaming giant. In an open letter addressed to WBD shareholders, Ellison argued that the company has not adequately explained how it arrived at key valuations underpinning the Netflix agreement.
According to Ellison, WBD has failed to disclose how it assessed the value of its Global Networks stub equity, how the overall Netflix deal was priced, how debt-related purchase price reductions would function, or the basis for what WBD terms a “risk adjustment” applied to Paramount’s competing USD 30-per-share all-cash offer.
In a parallel move, Paramount announced plans to nominate its own slate of directors at Warner Bros. Discovery. The proposed nominees, the company said, would be prepared to exercise WBD’s rights under the Netflix agreement to formally engage with Paramount’s offer and potentially pursue a transaction with Paramount instead.
The dispute follows Warner Bros. Discovery’s announcement in December of a landmark agreement with Netflix, under which the streamer would acquire WBD’s film and television studios, HBO and HBO Max, and its games division for USD 83 billion. Under the terms of that agreement, Netflix would pay USD 27.75 per share for those assets, with the transaction expected to close after WBD completes the spin-off of Discovery Global in the third quarter of 2026.
The planned Discovery Global spin-off is set to house several of WBD’s linear and lifestyle brands, including CNN, TBS, HGTV, Food Network and Discovery+, separating them from the entertainment and streaming-focused businesses destined for Netflix.
Looking ahead to WBD’s 2026 annual shareholder meeting, Paramount said it intends to propose an amendment to WBD’s bylaws that would require explicit shareholder approval for any separation of the Global Networks business. Ellison also warned that if WBD were to call a special shareholder meeting ahead of the annual gathering to approve the Netflix deal, Paramount would actively campaign against such approval.
