WBD, Paramount regulatory path might be easier than Netflix tie-up

A day after Paramount Skydance emerged as the winner to take over fellow media giant Warner Bros. Discovery, questions are mounting about the companies’ regulatory path forward.

The WBD board said on Thursday that Paramount’s revised $31-per-share offer was superior to an existing bid from Netflix, prompting the streamer to announce that it was walking away from the deal entirely and clearing the way for Paramount.

Paramount’s raised offer — up from $30 per share — was the latest in a series of moves it made after it launched a hostile bid late last year to buy WBD. It had initially lost out on a bidding war to Netflix, which offered $27.75 per share.

Paramount’s latest bid also included a $7 billion breakup fee if the deal doesn’t win regulatory approval. And according to a Friday filing, it has already paid the $2.8 billion breakup fee that WBD owed to Netflix if the deal fell through.

But media industry experts said it’s looking more likely that the Paramount deal will get through government scrutiny than it did when Netflix was in the picture.

Though Netflix executives had said they were “highly confident” that their deal would win approval, the merger would have brought together two top streaming services — Netflix and Paramount+ — and could have potentially raised prices for consumers and decreased competition.

In early December, Trump said the Netflix-WBD deal “could be a problem” because of the increased market share Netflix would gain, saying he would be involved. He walked back those comments earlier this month, saying the deal would be at the sole discretion of the Department of Justice.

And while the size of a combined Netflix and WBD entity was one of the companies’ largest antitrust obstacles, that issue could still be raised for Paramount.

Both Paramount and WBD have sprawling portfolios of TV networks, in addition to Paramount+ hitting 78.9 million subscribers, according to its most recent earnings report, and HBO Max counting 131.6 million subscribers through the end of 2025.

Paramount executives argued one of the pros of their offer was that a deal with the media company would garner less government scrutiny. Paramount Skydance CEO David Ellison’s father, Oracle co-founder Larry Ellison, is known to have close relations with President Donald Trump.

Trump’s son-in-law, Jared Kushner, is backing the Paramount deal, according to a filing with the Securities and Exchange Commission.

Still, Paramount’s proposed deal had come under criticism for potentially being funded by the sovereign wealth funds of Saudi Arabia; Abu Dhabi, United Arab Emirates; and Qatar. The company has previously said that those entities have agreed to…