Warner Bros. takeover odds tighten to dead heat

Kalshi traders are repricing markets related to Warner Bros. Discovery, with odds of a Netflix takeover on the rise despite Paramount Skydance’s recent counteroffer.

Paramount Skydance’s odds have slipped to 45% as traders reassessed whether the company can realistically compete with Netflix on both price and execution. Netflix’s odds have now risen to 45%, reflecting growing confidence that it can raise its offer if negotiations escalate.

In a more specific market, the odds of Paramount acquiring Warner Bros. have been dropping since Wednesday. Odds of the company acquiring Warner Bros. before June are now at 43%.

However, if negotiations drag on to the second half of the year, there is a 50% chance Paramount will purchase the company before September, and a 55% chance it will happen before December.

Part of Netflix’s appeal to the Warner Bros. Discovery board is its deal’s simplicity. The bid narrowly targets the studio and streaming businesses rather than the entire company, reducing regulatory exposure and potentially shortening the timeline to close, a key consideration as media valuations remain volatile.

That dynamic was reinforced by a Reuters report claiming Netflix has ample cash and could increase its offer if Paramount raises its bid. For traders, the report signaled that Netflix’s current price may be less important than its ability to control the bidding process.

Right now, Netflix has offered $82.7 billion for Warner Bros.’ studio and streaming businesses, and the Warner Bros. board seems to favor Netflix’s deal. However, Paramount re-entered negotiations with Warner Bros. on Tuesday and offered to make a counterbid. If the Reuters report is accurate, Netflix appears well positioned to respond with a more competitive offer.

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