Paramount Escalates Battle For WBD

Paramount Skydance, led by CEO David Ellison, has escalated its aggressive pursuit of Warner Bros. Discovery (WBD) by filing a lawsuit in Delaware Chancery Court on January 12, 2026. The suit seeks to compel WBD to disclose detailed financial information related to its $82.7–$83 billion deal with Netflix, particularly how the company has valued its cable networks and other assets that are slated for a spin-off into a new publicly traded entity called Discovery Global later in 2026.

This legal action follows WBD's board repeatedly rejecting Paramount's all-cash hostile takeover offer of $30 per share (valuing WBD at approximately $108.4 billion), most recently in early January 2026. WBD has favored Netflix's proposal, which involves selling its studio, streaming (including HBO and Max), and related assets to Netflix while spinning off the cable division—comprising networks like CNN, TNT Sports, TBS, HGTV, Food Network, and Discovery+—as Discovery Global. 

WBD argues this structure unlocks greater value for shareholders, especially from the cable assets, which it sees as having significant standalone potential. In contrast, Paramount has repeatedly downplayed the worth of those cable properties, at times valuing the spin-off at just $1 per share or even $0, citing factors like declining linear TV performance and comparisons to other recent cable spin-offs (such as Comcast's Versant).

In an open letter to WBD shareholders released alongside the lawsuit filing, David Ellison sharply criticized WBD for a "lack of transparency." He specifically highlighted the company's failure to disclose key details, including:How it valued the "Global Networks stub equity" (the remaining cable assets post-spin-off).

This move marks a significant intensification in the months-long battle for control of WBD's assets, which began with Paramount's unsolicited bids in late 2025 and has since involved multiple rejections, revised offers (including personal guarantees from Oracle co-founder Larry Ellison, David's father), and a shift to hostile tactics. The outcome could hinge on shareholder sentiment, potential proxy fights, and the Delaware court's ruling on the disclosure demands.