Paramount Skydance Corporation (PSKY) Stock: Drops Over 8% as Pursuit of WBD Heats Up After Netflix Deal

TLDR

• Netflix will acquire HBO Max and Warner Bros. studio for $27.75 per share.
• Paramount Skydance argues its $30-per-share all-cash bid is superior.
• David Zaslav stands to gain more than $660 million from the deal.
• Warner Bros. Discovery shares have doubled since September.
• Paramount may go directly to shareholders with a new offer.

Paramount Skydance Corporation (PSKY) trades at $13.61, down 8.18%, as the company reassesses its next move following Netflix’s surprise acquisition of Warner Bros. Discovery’s (WBD) film studio and HBO Max streaming business.

Paramount Skydance Corporation Class B Common Stock, PSKY

The deal has disrupted Paramount CEO David Ellison’s strategic plans, reshaping the competitive landscape while generating large returns for WBD shareholders and executives.

How Paramount Sparked a Bidding War

What began as a calculated approach by Ellison in September turned into a multi-company race that transformed the valuation of WBD. Ellison’s initial letter to the WBD board argued that combining Paramount and Warner Bros. Discovery would create a more competitive entertainment powerhouse.

Paramount was the first bidder seeking to acquire all of WBD’s assets:

• Warner Bros. film studio
• HBO Max streaming service

What followed was an unexpected outcome. While Paramount believed its strategic vision justified a merger, Netflix and Comcast zeroed in on narrower slices of WBD’s empire. Netflix’s bid won, leaving Ellison without the assets he aimed to secure and setting the stage for intensified competition.

Netflix Emerges With a Landmark Deal

Netflix secured the studio and streaming division at $27.75 per share, valuing the transaction at $72 billion. WBD plans to spin out its pay-TV networks before the deal closes. Netflix co-CEO Ted Sarandos stated that the timing is ideal because WBD prepared its assets in a way that optimized acquisition readiness.

This monumental move strengthens Netflix while eliminating a key consolidation pathway for both Paramount and Comcast’s NBCUniversal.

Zaslav Cashes In as Shareholders Celebrate

The sale process delivered large gains for WBD CEO David Zaslav. He holds more than 4.2 million shares, with 6.2 million more to be delivered later, plus 20.9 million options at an exercise price of $10.16. At the transaction price of $27.75, his holdings exceed $554 million. With an extra 4 million shares set for delivery in January, his total approaches $660 million.

Shareholders saw similar rewards. WBD stock doubled from $12.54 on September 10 to over $25, returning to 2022 levels when WarnerMedia merged with Discovery.

Paramount Pushes Back With Accusations

Paramount claims the sale process favored Netflix from the start. The company argues that its $30-per-share all-cash offer was superior, citing tax efficiencies and lower regulatory risks. Paramount also valued the Discovery Global networks at roughly $2 per share, while WBD sees potential for $3 or more if the networks perform well.

Paramount also raised concerns about political skepticism under a Trump administration toward a Netflix–WBD combination.

Next Steps: A Hostile Approach on the Table

Paramount is weighing a direct appeal to WBD shareholders. The company may submit an improved bid above $30 per share, forcing Netflix to match it. Both companies included breakup fees: Paramount at $5 billion and Netflix at $5.8 billion.

If Paramount moves forward, WBD shareholders stand to gain even more, while Zaslav’s total payout could grow further.

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