Why is Warner Bros for sale and what are the controversial bids?

A huge takeover that would rock the entertainment industry looks imminent, with Netflix and Paramount fighting over Warner Bros Discovery (WBD).

Streaming giant Netflix announced it had agreed a $72bn (£54bn) deal for WBD's film and TV studios on 5 December, only for Paramount to sweep in with a $108.4bn (£81bn) bid several days later - and they're not giving up without a fight.

Filled with ongoing twists and turns, the takeover saga isn't far removed from a Hollywood plot; with multi-billionaires negotiating in boardrooms, politicians on all sides expressing their fears for the public and the US president looming large, expected to play a significant role.

"Whichever way this deal goes, it will certainly be one of the biggest media deals in history. It will shake up the established TV and film norms and will have global implications," Sky News' US correspondent Martha Kelner said on the Trump 100 podcast.

So what do we know about the bids, why are they controversial - and how is Donald Trump involved?

Why is Warner Bros up for sale?

WBD's board first announced it was open to selling or partly selling the company in October after a summer of hushed speculation.

Back in June, WBD announced its plan to split into two companies: one for its TV, film studios, and HBO Max streaming services, and one for the Discovery element of the business, primarily comprising legacy TV channels that air cartoons, news, and sports.

It came amid the cable industry's continued struggles at the hands of streaming services, and CEO David Zaslav suggested splitting into two companies would give WBD's brands the "sharper focus and strategic flexibility they need to compete most effectively in today's evolving media landscape".

The company's long-term strategic initiatives have also been stifled by its estimated $35bn of debt. This wasn't helped by the WarnerMedia and Discovery merger in 2022, which led to it becoming Warner Bros Discovery.

What we know about the bids

The $72bn bid from Netflix is for the first division of the business, which would give it the rights to worldwide hits like the Harry Potter and Game of Thrones franchises - and Warner Bros' extensive back catalogue of movies.

If the deal were to happen, it would not be finalised until the split is complete, and Discovery Global, including channels like CNN, will not form part of the merger.

WBD's board has unanimously recommended that shareholders accept Netflix's proposal to buy the streaming portion of WBD's business and reject Paramount Skydance's offer.

While Netflix's offer has a lower headline value, financial analysts have said it presents a clearer financing structure and fewer execution risks than Paramount's bid for the entire company.

Paramount's $108.4bn offer is what's known as a hostile bid. This means it went directly to shareholders with a cash offer for the entirety of the company, asking them to reject the deal with Netflix.

This deal would involve rival US news channels CBS and CNN being brought under the same parent company.

Netflix's cash and stock deal is valued at $27.75 (£20.80) per Warner share, giving it a total enterprise value of $82.7bn (£62bn), including debt.

But Paramount says its deal will pay $30 (£22.50) cash per share, representing $18bn (£13.5bn) more in cash than its rivals are offering.

Paramount claims to have tried several times to bid for WBD through its board, but said it launched the hostile bid after hearing of Netflix's offer because the board had "never engaged meaningfully".

A letter to investors from the WBD board claimed the all-cash offer from Paramount involved an "extraordinary amount of debt financing" that could saddle the smaller Hollywood studio with $87bn in debt.

WBD has also said it would owe Netflix a $2.8bn (£2.077bn) termination fee if it walks away from the agreement, part of $4.7bn (£3.5bn) in extra costs to end the deal.

Paramount Skydance launches lawsuit

In January Paramount filed a lawsuit seeking to force WBD to disclose financial data regarding the takeover bids.

Specifically, Paramount is trying to force the release of information on how WBD valued multiple elements of Netflix's rival takeover attempt, Paramount's own offer and part of WBD's own valuation.

An open letter to WBD shareholders Paramount claimed it was customary for such disclosures to be made when a board makes an investment recommendation.

It has also threatened to nominate directors at WBD's annual meeting in an effort to get board approval for its takeover.

It also said it would propose an amendment to WBD's bylaws that would require shareholder approval for any separation of the media giant's cable TV business, which is key to the Netflix deal.

A WBD spokesperson said in a statement: "Despite six weeks and just as many press releases from Paramount Skydance, it has yet to raise the price or address the numerous and obvious deficiencies of its offer.

"Instead, Paramount Skydance is seeking to distract with a meritless lawsuit and attacks on a board that has delivered an unprecedented amount of shareholder value."

Why are politicians and experts concerned?

The US government will have a big say on who ultimately buys WBD, as Paramount and Netflix will likely face the Department of Justice's (DOJ) Antitrust Division, a federal agency which scrutinises business deals to ensure fair competition.

Republicans and Democrats have voiced concerns over the potential monopolisation of streaming and the impact it would have on cinemas if Netflix - already the world's biggest streaming service by market share - were to take over WBD.

Democratic senator Elizabeth Warren said the deal "would create one massive media giant with control of close to half of the streaming market - threatening to force Americans into higher subscription prices and fewer choices over what and how they watch, while putting American workers at risk".

Similarly, Representative Pramila Jayapal, who co-chairs the House Monopoly Busters Caucus, called the deal a "nightmare," adding: "It would mean more price hikes, ads, and cookie-cutter content, less creative control for artists, and lower pay for workers."

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Netflix's business model of prioritising streaming over cinemas has caused consternation in Hollywood.

The screen actors union SAG-AFTRA said the merger "raises many serious questions" for actors, while the Directors Guild of America said it also had "concerns".

Experts suggest there's less of a concern with the Paramount deal when it comes to a streaming monopoly, because its Paramount+ service is smaller and has less of an international footprint than Netflix.

How is Trump relevant?

After Netflix announced its bid, the president said of its path to regulatory clearance: "I'll be involved in that decision."

And while Mr Trump himself will not be directly involved, he appointed those in the DOJ Antitrust Division, and they have the authority to block or challenge takeovers.

However, his potential influence isn't sitting well with some experts due to his ties with key players on the Paramount side.

Paramount is run by David Ellison, the son of the Oracle tech billionaire - and world's second-richest man - Larry Ellison, who is a close ally of Mr Trump.

Additionally, Affinity Partners, an investment firm run by Mr Trump's son-in-law Jared Kushner, would be investing in the deal.

Also participating would be funds controlled by the governments of three unnamed Persian Gulf countries, widely reported as Saudi Arabia, Abu Dhabi and Qatar - countries the Trump family company has struck deals with this year.

Critics of the Trump's administration have accused it of being transactional, with the president known to hold grudges over those who are critical of him, however, Mr Trump told reporters on 8 December that he has not spoken with Mr Kushner about WBD, adding that neither Netflix nor Paramount "are friends of mine".

John Mayo, an antitrust expert at Georgetown University, suggested the scrutiny by the Antitrust Division would be serious whichever offer is approved by shareholders, and that he thinks experts there will keep partisanship out of their decisions despite the politically charged atmosphere.

(c) Sky News 2026: Why is Warner Bros for sale and what are the controversial bids?