Paramount sweetens WBD offer with quarterly fees, Netflix break fee coverage

Paramount Skydance Corporation (NASDAQ: PSKY) enhanced its $30 per share all-cash takeover offer for Warner Bros. Discovery Inc. (NASDAQ: WBD) by adding a $0.25 per share quarterly "ticking fee" and agreeing to pay WBD's $2.8 billion termination fee to Netflix Inc.

The ticking fee would begin accruing January 1, 2027, if the transaction has not closed by December 31, 2026. Paramount said this demonstrates confidence in obtaining regulatory approval quickly.

Paramount certified compliance with the Department of Justice's second information request on February 9, 2026, starting a 10-day waiting period. The company also received clearance from German foreign investment authorities on January 27, 2026.

The enhanced offer includes $43.6 billion in equity commitments from the Ellison Family and RedBird Capital Partners, plus $54.0 billion in debt commitments from Bank of America, Citigroup and Apollo. Larry Ellison provided a personal guarantee of $43.3 billion.

Paramount will also eliminate WBD's potential $1.5 billion debt financing cost by backstopping a bond exchange offer. The company said it would reimburse shareholders for this amount if the exchange fails and the Paramount transaction does not close.

The offer contrasts with Netflix's sliding scale consideration, which WBD disclosed ranges from $21.23 to $27.75 per share in cash, depending on debt levels at Discovery Global during separation. Paramount argued the Netflix deal's cash component could fall to $23.20 per share based on comparable company analysis.

WBD has not engaged with Paramount's proposals, maintaining its agreement with Netflix announced in December 2025. Paramount stated it will solicit proxies against the Netflix transaction at WBD's special shareholder meeting.

Paramount extended its tender offer expiration to March 2, 2026. As of February 9, 42.3 million WBD shares had been tendered.

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