A high-stakes corporate battle is unfolding in the U.S. media sector as Paramount Skydance moves to derail Warner Bros. Discovery’s planned merger with Netflix, turning a months-long takeover contest into a full-blown proxy fight. At issue is not only which bid delivers greater shareholder value, but also how boards justify complex deal structures at a time when traditional media economics are under pressure and streaming consolidation is accelerating.

A Proxy Fight Takes Shape

Paramount Skydance Corp., led by David Ellison, said it will nominate directors to the board of Warner Bros. Discovery in an effort to block the company’s agreed transaction with Netflix. The move represents a sharp escalation after Warner Bros. repeatedly rejected Paramount’s takeover proposals over the past four months.

Paramount argues that its all-cash offer of $30 per share for Warner Bros. offers greater certainty and value than Netflix’s $27.75-per-share cash-and-stock agreement. From Paramount’s perspective, the proxy contest is a necessary step to give shareholders a direct voice after what it characterizes as a closed and unresponsive negotiation process.

Legal Pressure and Disclosure Claims

Alongside the proxy push, Paramount has filed suit in Delaware Chancery Court, accusing Warner Bros. of failing to provide adequate disclosure around the Netflix transaction. The complaint seeks detailed information on valuation methodologies, bankers’ analyses, and the “risk adjustments” applied by the board when recommending the Netflix deal over Paramount’s higher headline bid.

The legal strategy reflects a broader trend in contested M&A, where bidders increasingly rely on disclosure arguments to sway investors. Paramount contends that while its cash offer is straightforward to value, the mixed consideration from Netflix obscures downside risks related to regulatory approval, execution complexity, and post-merger integration.

Strategic Disagreements Over Asset Value

Warner Bros. has defended its choice by pointing to the planned spin-off of its cable television assets into a new entity, Discovery Global, later this year. Management argues that the optionality and upside from that transaction enhance the appeal of the Netflix deal. Paramount strongly disputes that view, asserting that the spun-off assets carry minimal economic value and should not outweigh the certainty of an all-cash proposal.

This divergence highlights a deeper philosophical split. Warner Bros.’ board appears focused on strategic alignment with a dominant streaming platform, while Paramount emphasizes immediate valuation clarity and reduced execution risk at a time when legacy media cash flows remain volatile.

Market Reaction and Investor Psychology

Early market moves reflect the uncertainty. Warner Bros. shares slipped modestly following the announcement, while Netflix edged higher and Paramount gained around 1%. The muted reaction suggests investors are weighing not just price, but deal completion risk and governance credibility. In an environment where failed transactions can erase months of gains, perceived certainty has become a critical component of valuation.

What Comes Next

The contest is likely to intensify as shareholders assess competing narratives ahead of Warner Bros.’ annual meeting or a special vote. For investors in the U.S. and Israel alike, the situation underscores how governance, transparency, and strategic vision can be just as influential as headline price in transformational media deals. The outcome may also set a precedent for how aggressively boards are challenged when shareholders believe superior alternatives exist.