Paramount has launched a hostile takeover bid for Warner Bros. Discovery (WBD), promising a significant commitment to theatrical releases, a direct counter to Netflix's prior binding agreement to acquire certain parts of the media giant. In a call with press and investors, Paramount announced its intention to release more than 30 films theatrically and honor “healthy traditional windows,” a clear jab at Netflix, which secured an agreement to acquire Warner Bros. and HBO for $82.7 billion.

Netflix Co-CEO Ted Sarandos has previously expressed a dismissive view of the traditional theatrical experience, leading to concerns within Hollywood’s creative community that Netflix’s acquisition of a major studio could harm cinemas by reducing the number of theatrical releases. While Sarandos confirmed that Netflix would uphold Warner Bros.’s existing theatrical commitments and noted that the streamer already releases many films in theaters (primarily for awards qualification), he also indicated that the duration of exclusive cinema windows would “evolve” to be more “consumer friendly.” Sarandos stated that Netflix's primary goal is to deliver first-run movies directly to its members, aligning with their viewing preferences, rather than prioritizing extended theatrical runs.

Paramount Skydance's offer, initiated on Monday, is an all-cash tender offer to acquire all outstanding shares of WBD for $30 per share, mirroring the terms of a bid submitted on December 4 to WBD's board. This proposed transaction encompasses the entirety of Warner Bros. Discovery, including its extensive television business comprising CNN, TBS, TNT, and other networks. Paramount values its all-cash offer at an enterprise value of $108.4 billion, which includes the assumption of WBD's debt. In stark contrast, Netflix's proposal is valued at $27.75 per share, structured as a mix of cash ($23.25) and stock ($4.50), and is specifically for certain components of WBD, allowing most of the company’s cable assets to be spun off into a separate entity.

David Ellison, Chairman and CEO of Paramount, articulated the company's vision, emphasizing a deep belief in the future of the movie and entertainment business. He stated that the transaction is geared towards preserving and strengthening the industry, building “more, not cutting back,” and creating more opportunities for the industry, choices for consumers, value for shareholders, and support for creative talent. Since Skydance's acquisition of Paramount last summer, the team has been actively working to revitalize the studio’s theatrical output. The company aims to significantly increase its annual theatrical releases from the current eight to 15 by 2026, 17 by 2027, and 18 by 2028. This strategy contrasts with Warner Bros.’s traditional output of 12 to 14 movies annually, a studio that had a strong year with hits like “Weapons,” “Sinners,” and “Superman.”