Activist investor backs rival Paramount offer, escalating high-stakes Hollywood takeover battle
A new twist has emerged in the takeover battle for Warner Bros. Discovery, as activist investor Ancora Capital disclosed a roughly $200 million stake and announced plans to oppose the company’s proposed deal with Netflix. The move intensifies an already heated contest involving a competing bid from Paramount Global.
Ancora argues that the Netflix transaction undervalues Warner Bros. Discovery and exposes shareholders to unnecessary risk. In a statement, the activist said the Netflix deal asks investors to “accept inferior value, gamble on an uncertain spinoff and shoulder significant regulatory risk,” despite what it describes as a higher and more certain $30 per share offer from Paramount.
Paramount’s bid, valued at $108.4 billion including debt, exceeds Netflix’s $27.75 per share offer, which is valued at $82.7 billion including debt. Paramount has recently sweetened its proposal by offering additional cash payments if the deal fails to close on time and by agreeing to cover a $2.8 billion breakup fee Warner Bros. Discovery would owe Netflix if it walks away. However, analysts suggest Paramount may still need to raise its headline bid to persuade the Warner board.
At the center of the dispute is a planned spin-off of Warner Bros.’ cable assets, including CNN and TNT, which is integral to the Netflix proposal. Under that structure, shareholders would retain a stake in a separately traded Discovery Global entity. Paramount, by contrast, argues those cable assets have limited value and that Netflix’s structure leaves investors exposed to volatility tied to the spinoff’s financial condition.
Warner Bros. Discovery’s board has expressed support for the Netflix deal, and a shareholder vote is expected by April. With Ancora now actively campaigning against it, the outcome of this multibillion-dollar media showdown remains highly uncertain.
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