The entertainment industry just witnessed one of the most aggressive corporate power plays in recent memory. Paramount, now under Skydance Corporation, has launched a stunning $108.4 billion hostile takeover bid for Warner Bros. Discovery on December 8, 2025, directly challenging Netflix’s previously announced $82.7 billion acquisition deal. This bid includes some of gaming’s most valuable studios and franchises, putting major properties like Mortal Kombat, Batman Arkham, and Harry Potter games in the crosshairs of this corporate battle.
The Bidding War Explained
Netflix struck first on December 5, 2025, announcing an agreement to acquire Warner Bros. Discovery’s studios and streaming division for $72 billion in equity value. The deal seemed done, with both companies publicly supporting the merger. But Paramount CEO David Ellison wasn’t ready to walk away. Just three days later, Paramount went directly to Warner Bros. shareholders with an all-cash offer of $30 per share, valuing the entire company at $108.4 billion.
The difference between these offers is significant. Netflix proposed $27.75 per share, combining $23.25 in cash with $4.50 in Netflix stock, and only wanted Warner Bros. studios, HBO, and HBO Max. Paramount’s offer is pure cash at $30 per share and includes everything, even the cable networks Netflix doesn’t want. Ellison told CNBC that Paramount is offering shareholders $17.6 billion more in cash than Netflix’s deal, making his pitch simple – cash is king on Wall Street.
What This Means for Gaming
Warner Bros. Games sits at the heart of this bidding war, representing billions in potential revenue from some of gaming’s most beloved franchises. The division includes multiple world-class development studios that have produced massive hits over the past two decades.
Under either deal, these studios would change ownership:
– NetherRealm Studios in Chicago, creators of the Mortal Kombat franchise and Injustice series
– Rocksteady Studios in London, developers of the critically acclaimed Batman Arkham series
– Avalanche Software in Salt Lake City, the team behind the blockbuster Hogwarts Legacy
– TT Games and Traveller’s Tales, the masters of LEGO video games including LEGO Star Wars and LEGO Batman
– WB Games Montreal, developers of Batman Arkham Origins and Gotham Knights
Game Developer confirmed that Netflix’s original deal includes the Warner Bros. Games division, and Paramount’s competing offer naturally encompasses these assets as well since it’s bidding for the entire company. This means franchises like DC Comics games featuring Batman and Superman, Harry Potter gaming properties, Lord of the Rings titles, and Mortal Kombat would all transfer to whichever company wins this battle.
Where Paramount Got the Money
The most eyebrow-raising aspect of Paramount’s bid is the financing. Paramount’s entire market valuation sits around $14 billion with only $3 billion in liquid assets, so how are they proposing a $108 billion cash offer? The answer involves some controversial partners.
According to regulatory filings, the Ellison family and RedBird Capital have committed $40 billion. The remaining funding comes from Middle Eastern sovereign wealth funds and Jared Kushner’s Affinity Partners investment firm. Specifically, Paramount secured $24 billion from Saudi Arabia, Qatar’s Mubadala Holding Co., and the Abu Dhabi government. Some reports also suggest Tencent may be involved in the bidding process, though this hasn’t been officially confirmed.
This foreign funding has raised concerns among industry observers, particularly given the strategic importance of media and entertainment companies. The involvement of government-backed investment funds from multiple countries adds a geopolitical dimension to what’s already a complicated corporate acquisition.
Netflix Isn’t Backing Down
Netflix CEO Ted Sarandos quickly responded to Paramount’s hostile bid, calling it completely anticipated but expressing confidence their deal will close. Sarandos pointed out that Paramount’s bid claims $6 billion in synergies, questioning where those savings would come from. His implication was clear – massive job cuts. Netflix positioned itself as the company that won’t eliminate jobs but will create them instead.
Netflix also argues that once Warner Bros. Discovery spins off its cable networks like CNN, shareholders will receive additional value per share that makes their offer ultimately worth more than Paramount’s. The math gets complicated, but Netflix is betting shareholders will see long-term value in their stock component versus Paramount’s all-cash approach.
Another major difference is theatrical commitment. Paramount promised to release over 30 films in theaters annually if the acquisition succeeds, a direct shot at Netflix’s historically lukewarm support for theatrical releases. Sarandos has previously called the moviegoing experience outdated, suggesting streaming windows should be shorter. Paramount is positioning itself as Hollywood’s defender against streaming’s disruption of traditional cinema.
Regulatory Hurdles Ahead
Both deals face serious regulatory scrutiny from antitrust authorities. Either acquisition would create an entertainment giant with unprecedented control over film, television, streaming, and gaming content. Warner Bros. Discovery already represents a massive consolidation of media assets, and adding it to either Netflix or Paramount raises legitimate competition concerns.
The Netflix deal is expected to take 12-18 months if approved, while Paramount’s tender offer expires January 8, 2026. However, recent years have shown that major gaming and entertainment acquisitions can drag on much longer. Microsoft’s purchase of Activision Blizzard took nearly two years and required significant concessions to win regulatory approval. This Warner Bros. situation could prove even more complicated given the breadth of assets involved.
What Happens Next
Warner Bros. Discovery shareholders now face a critical decision. Do they take Paramount’s higher cash offer with financing from controversial sources, or stick with Netflix’s lower but potentially safer deal backed by an established tech giant? The choice isn’t just about money – it’s about the future direction of the entertainment and gaming industries.
For gamers, the outcome determines who controls some of the industry’s most valuable franchises and talented development studios. Netflix has been aggressively expanding into gaming with mobile titles and studio acquisitions like Night School Studios, but remains unproven in the console and PC space. Paramount, meanwhile, has minimal gaming experience beyond licensing deals.
The bidding war also highlights the gaming industry’s ongoing consolidation crisis. Warner Bros. Games already shut down three studios earlier in 2025, including Monolith Productions which was developing a Wonder Woman game. More consolidation under either buyer could mean additional studio closures and job losses, despite Netflix’s assurances to the contrary.
FAQs
How much is Paramount offering for Warner Bros. Discovery?
Paramount is offering $30 per share in an all-cash deal, valuing Warner Bros. Discovery at approximately $108.4 billion for the entire company including all assets and subsidiaries.
Which gaming studios are included in this acquisition?
Warner Bros. Games includes NetherRealm Studios (Mortal Kombat), Rocksteady Studios (Batman Arkham series), Avalanche Software (Hogwarts Legacy), TT Games (LEGO games), and WB Games Montreal (Gotham Knights). All of these studios would transfer to whichever company successfully acquires Warner Bros.
Is Netflix’s offer lower than Paramount’s?
Yes, Netflix offered $27.75 per share combining cash and stock, with a total equity value of $72 billion. However, Netflix argues their deal provides more total value when accounting for the future spinoff of cable networks not included in their purchase. Paramount’s all-cash $30 per share offer is objectively higher upfront.
Where is Paramount getting the money for this bid?
The Ellison family and RedBird Capital committed $40 billion. An additional $24 billion comes from Middle Eastern sovereign wealth funds including Saudi Arabia, Qatar, and Abu Dhabi, plus Jared Kushner’s Affinity Partners investment firm. Tencent may also be involved according to some reports.
Will this acquisition affect Mortal Kombat and Batman games?
Yes, ownership of these franchises would transfer to either Netflix or Paramount depending on which deal succeeds. This could significantly impact development priorities, budgets, platform strategies, and the creative direction of future titles in these series.
When will we know which company wins?
Paramount’s tender offer expires on January 8, 2026, so shareholders have about a month to decide. However, even after a winner emerges, regulatory approval could take 12-18 months or longer. The final outcome may not be clear until late 2026 or 2027.
What does hostile takeover mean in this context?
A hostile takeover means Paramount bypassed Warner Bros. Discovery’s board of directors and went directly to shareholders with their offer. Warner Bros. management already agreed to Netflix’s deal, but Paramount is trying to convince shareholders to reject that agreement and accept their competing bid instead.
How will this affect Warner Bros. Games employees?
The impact is uncertain and depends on which company wins. Paramount claims $6 billion in synergies, which typically means significant job cuts and operational consolidation. Netflix promises to create jobs rather than eliminate them, but consolidation historically results in layoffs regardless of initial promises. Gaming industry workers are justifiably concerned about their futures.
Conclusion
This unprecedented bidding war represents a pivotal moment for the entertainment and gaming industries. Warner Bros. Games houses some of the most talented developers and valuable intellectual properties in the business, and their future hangs in the balance between two very different potential owners. Netflix brings streaming expertise and global reach but limited gaming credentials, while Paramount offers more money backed by foreign governments with unclear strategic intentions. Gamers, industry workers, and fans of franchises like Mortal Kombat and Batman should pay close attention to how this saga unfolds over the coming months. The decision made by Warner Bros. Discovery shareholders in January 2026 will reshape the competitive landscape of gaming and entertainment for years to come, determining not just who owns these beloved franchises but how they’ll be developed, distributed, and experienced by millions of fans worldwide.