Paramount vs. Netflix: the battle for Warner Bros.

The entertainment industry is experiencing a corporate earthquake. Netflix announced the purchase of Warner Bros. and HBO for about 82.7 billion dollars, but just days later Paramount Global shook the board with a hostile takeover bid valued at 108.4 billion dollars. The outcome of this clash will define the future of streaming, cinema, and even video games.

What is a hostile takeover bid?

A Public Tender Offer (OPA) is the mechanism by which a company offers to buy shares of another publicly traded company.

• Friendly takeover: negotiated with the target company’s board of directors and approved by them.
• Hostile takeover: launched directly to shareholders, without the consent of the board, offering more attractive conditions to force the deal.

In this case, Paramount Global decided to bypass Warner Bros.’ management and go directly to shareholders, offering $30 in cash per share, compared to Netflix’s $27.75 proposal.

Differences between the offers

Aspect	Netflix Acquisition	Paramount Hostile Bid
Nature	Friendly deal, negotiated with the board	Hostile offer, direct to shareholders
Amount	≈ 82.7 billion USD	≈ 108.4 billion USD
Payment Method	Mixed (shares + strategic integration)	Cash, immediate liquidity
Included Assets	Film, TV, HBO/HBO Max	Entire conglomerate (CNN, TBS, HGTV, Discovery, Warner Bros. Games)
Regulatory Risk	High: potential streaming concentration	Lower, though subject to media scrutiny
Execution Speed	Slow, subject to regulatory approval	Faster, with immediate liquidity for shareholders

Impact on Warner Bros. Games

One of the most sensitive points is the fate of Warner Bros. Games, responsible for hits like Hogwarts Legacy (over 22 million copies sold in 2023) and the Mortal Kombat saga.

• Netflix: its main interest lies in audiovisual content, so the gaming division could remain as a strategic complement.
• Paramount: historically has licensed its IPs to third parties, so some analysts believe it might sell part of Warner Bros. Games to recover capital and reduce debt.
• Alternative scenario: Paramount could leverage internal studios (NetherRealm, Rocksteady, Monolith) to develop games based on its own franchises like Star Trek or Mission Impossible.

Market reactions

• Shares of both companies have shown volatility after the announcements.
• Investors are weighing Paramount’s premium, which is more attractive than Netflix’s.
• Analysts warn that both companies carry significant debt and that the streaming market is saturated, complicating future profitability.

Regulatory hurdles

The deal will face intense scrutiny from the FTC in the U.S. and European authorities.

• Netflix + Warner: risk of monopoly in streaming.
• Paramount + Warner: risk of media concentration, especially in film, TV, and news.
• Regulators could impose severe conditions or even block the deal, potentially extending the process for months or years.

Conclusion

The difference between the two proposals is structural:

• Netflix proposes a strategic merger that faces high regulatory risk.
• Paramount offers a hostile cash bid, more attractive to shareholders and with greater chances of success.

The outcome of this battle will determine who writes the next chapter of global entertainment.