Netflix has granted a seven-day waiver permitting Warner Bros. Discovery to reopen talks with Paramount Skydance.
Warner Bros. has a pending transaction with Netflix, but Paramount has launched a hostile bid of US$30 per share to Warner Bros shareholders after losing out to Netflix in the bidding war.
“Netflix has provided WBD a limited waiver under the terms of WBD’s merger agreement with Netflix, permitting WBD to engage in discussions with Paramount Skydance (“PSKY”) (NASDAQ: PSKY) for a seven-day period ending on February 23, 2026 to seek clarity for WBD stockholders and provide PSKY the ability to make its best and final offer,” Warner Bros. Discovery said in a release.
“During this period, WBD will engage with PSKY to discuss the deficiencies that remain unresolved and clarify certain terms of PSKY’s proposed merger agreement.”
Paramount’s initial bid promised $30 per share, but the company’s leadership said it could go higher.
Last week, the company sweetened the deal with additional enhancements but didn't raise the per-share value.
However, Warner Bros has said a senior Paramount representative informed a WBD board member that it would pay $31 per share if deal talks were to reopen.
Warner Bros president and CEO David Zaslav said the company’s sole focus has maximising value and certainty for shareholders.
"Every step of the way, we have provided PSKY with clear direction on the deficiencies in their offers and opportunities to address them,” he said.
“We are engaging with PSKY now to determine whether they can deliver an actionable, binding proposal that provides superior value and certainty for WBD shareholders through their best and final offer."
After the limited waiver period, Netflix will retain its matching rights provided by the merger agreement, WBD said.
Netflix co-CEO Ted Sarandos told CNBC that the waiver was granted to give shareholders clarity.
“Paramount had been making a ton of noise, flooding the zone with confusion for shareholders ... including floating all these hypothetical offers and talking directly to the shareholders and bypassing the Warner Bros. Discovery board,” Sarandos said.
“So we’ve given the opportunity to get those shareholders exactly what they deserve, which is complete clarity and certainty.”
Netflix’s bid would see the media giant acquire Warner Bros film and television studios, HBO Max and HBO for $27.75 per share.
Paramount said it acknowledged Warner Bros' announcement while also noting it still believes its offer to be superior to Netflix’s.
“Although the Board’s actions are unusual, Paramount is nonetheless prepared to engage in good faith and constructive discussions,” Paramount said in a statement.
Warner Bros also announced a special shareholders meeting to be held on 20 March and said its board continues to recommend the Netflix deal over Paramount’s offer unanimously.
Netflix said in a statement that the shareholder meeting date marked an “important milestone for our transaction with WBD.”
“While we are confident that our transaction provides superior value and certainty, we recognise the ongoing distraction for WBD stockholders and the broader entertainment industry caused by PSKY’s antics,” Netflix said.
“Accordingly, we granted WBD a narrow seven-day waiver of certain obligations under our merger agreement to allow them to engage with PSKY to fully and finally resolve this matter.”
