Paramount Skydance has filed a lawsuit against Warner Bros. Discovery (WBD), seeking detailed financial disclosures related to WBD’s USD 83 billion transaction with streaming giant Netflix.
According to reports, Paramount, led by chairman and chief executive officer David Ellison, on January 12 announced plans to nominate its own slate of directors to the WBD board. The company said its nominees would exercise WBD’s rights under the Netflix agreement to engage with Paramount’s offer and, if appropriate, pursue a transaction in line with their fiduciary responsibilities.
In an open letter addressed to WBD shareholders, Ellison alleged that the company has failed to provide sufficient transparency on how key elements of the Netflix deal were valued. These include the valuation of the Global Networks stub equity, the overall valuation framework of the Netflix transaction, the mechanism for purchase price reductions linked to debt, and the basis for what he described as WBD’s “risk adjustment” applied to Paramount’s USD 30-per-share all-cash offer.
“WBD has failed to include any disclosure about how it valued the Global Networks stub equity, how it valued the overall Netflix transaction, how the purchase price reduction for debt works in the Netflix transaction, or even what the basis is for its ‘risk adjustment’ of our USD 30 per share all-cash offer,” Ellison wrote.
Paramount filed the suit in the Delaware Chancery Court on January 12, seeking an order compelling WBD to disclose the requested information so that shareholders can make an informed decision on whether to tender their shares into Paramount’s offer.
The legal action comes about a month after Warner Bros. Discovery announced an agreement in December under which Netflix would acquire WBD’s television and film studios for USD 83 billion.
Ahead of WBD’s 2026 annual shareholders’ meeting, Paramount said it would also propose an amendment to the company’s bylaws requiring shareholder approval for any separation of its Global Networks business. Ellison added that if WBD convenes a special shareholder meeting prior to the annual meeting to seek approval for the Netflix deal, Paramount would solicit proxies opposing such a move.
Under the proposed transaction, Netflix would pay USD 27.75 per share for WBD’s film and television studios, HBO and HBO Max, and its gaming division. The deal is expected to be completed after WBD’s planned spin-off of Discovery Global in the third quarter of 2026, which would house assets including CNN, TBS, HGTV, Food Network and Discovery+, according to Variety.
