Podcast Summary: “The Ellison Empire Strikes Back: Paramount Goes Hostile”

The Town with Matthew Belloni
Date: December 9, 2025
Host: Matthew Belloni (The Ringer)
Guest: Peter Supino, Managing Director & Senior Analyst, Wolf Research

Episode Overview

Matthew Belloni breaks down a seismic Hollywood business moment: David Ellison and Paramount’s surprise “hostile” all-cash bid for Warner Bros. Discovery, directly challenging a previously announced deal with Netflix. Peter Supino—returning financial analyst and industry expert—joins to clarify the nuances of the competing bids, regulatory concerns, and what’s really at stake for the future of Warner Bros., Hollywood, and streaming giants.

Key Discussion Points & Insights

1. The Paramount Hostile Bid vs. Netflix’s Deal

• Overview of the Situation

  • David Ellison (Paramount) has gone hostile in a direct all-cash $30/share bid to buy Warner Bros. Discovery (“WBD”), versus a Netflix offer valued near $28/share (mix of cash and stock).

  • Netflix’s bid only buys the studio and streamer; Ellison wants it all: studio, streamer, and the “ShitCo”—WBD’s low-growth cable networks (CNN, TBS, TNT).

    “Ellison sent a letter to our guy David Zaslav and his board…arguing that it’s all cash…$30 a share offer for the owner of HBO Max and the Warner Brothers studio is a better deal.”
    — Matthew Belloni, 01:00

  • The value split comes down to how you value “ShitCo,” the soon-to-be-spun-off cable channels. Analysts’ per-share estimates range from $1 to $5.

    • Netflix says the cable bundle is worth more ($3–5), propping up its bid.
    • Ellison claims it’s only worth $1/share, making his offer bigger on a total basis.

  • Real-time drama: Ellison appeared on CNBC defending his offer; Netflix’s Ted Sarandos responded at a UBS conference, touting Netflix’s deal as “great for shareholders and consumers” and avoiding job cuts (01:50).

2. Timeline & How the Bidding Went Down

• Bid Sequence & Confusion

  • Supino outlines that Netflix and WBD agreed on terms Dec. 4; Paramount submitted its (superior) $30 bid late that day or right after the Netflix agreement, possibly missing the window.

    “Maybe Paramount’s best offer…came right as or after the board made an agreement with Netflix, which they announced the next day.”
    — Peter Supino, 05:25

  • The mood grew awkward—texts from Ellison to Zaslav reportedly went unanswered, with Ellison feeling jilted (“jilted lover style texts”).

3. Breaking Down the Two Bids

• Netflix Proposal (07:04)

  • $27.75/share: $23.25 in cash, $4.50 in Netflix stock.

  • Excludes the “Global Networks” (aka “ShitCo”).

  • Residual value for WBD shareholders is what the spun-off cable networks will fetch (est. $1–3, sometimes up to $5/share).

    “So no shitco, 2775 for the good stuff. Reasonable range…ShitCo’s value is 1 to $3 per share…”
    — Supino, 07:26

• Paramount Proposal

  • $30 cash per share for everything (studio, streamer, AND cable).

  • Includes financing guarantees from Ellison, Redbird Capital, and others; no financing contingency.

  • Paramount matches Netflix’s $5+ billion breakup fee guarantee.

    “Paramount has offered $30 of cash for the whole enchilada, including Shipco…includes financial guarantees…the deal does not include a financing contingency.”
    — Supino, 09:38

• Disputed Issues

  • Warner’s board claims Ellison’s side lacked proof of financial support and raised “foreign money” scrutiny (from Middle East backers).

    “There’s all this issue of the foreign money… it did raise questions as to whether they would be above a threshold to require an inquiry… there’s an ick factor to that, right?”
    — Belloni, 11:16

4. Synergies & Hollywood Jobs Anxiety

• Paramount’s Promise: $6 Billion in Synergies

  • Translation: Major job cuts.

    • “Synergy” = staff consolidation—executives, crew, all merged with significant layoffs.
    • Hollywood insiders fear the impact.

    “Most of that comes from people getting fired, plain and simple. Two studios mashing together…everyone is duplicative.”
    — Belloni, 13:58

• Netflix’s Promise: Gentler Touch

  • Netflix claims less duplication, more focus on technology and existing content deals; less risk of staff slaughter, more preserving Warner’s/HBO’s unique identities.

    • Ted Sarandos: Netflix won’t disrupt Warner or HBO’s creative engines.

    “Ted said it today…we’re not going to disrupt those businesses. This is why we’re buying the company.”
    — Belloni, 14:45

    • Belloni notes: Netflix gets a “pro-Netflix” argument similar to how Disney let FX and Searchlight retain autonomy despite mergers.

5. Regulatory and Political Entanglements

• Which Bid Is More Likely to Get Approval?

  • Paramount touts “lower regulatory risk,” but realism is murky.

  • Paramount’s ties to Middle Eastern cash and Jared Kushner (Trump’s son-in-law) make the optics complicated and add political uncertainty.

    “Already the Ellisons have brought in Jared Kushner…Trump…wants to insert himself into any possible deal…”
    — Belloni, 17:01

  • Trump and regulatory approval are wildcards—he signals skepticism for both bids and seems motivated by self-interest.

    “What he’s actually projecting is: Where’s my piece? Where’s my cut? What are you gonna do for me? And that is exactly the problem here…”
    — Belloni, 17:36

  • Market definition matters: streaming vs. linear TV has big implications for anti-trust/regulatory review.

    • Netflix wants the biggest pool possible for market share comparisons; Paramount’s case is stronger when examining linear TV and overall exposure, which remains below ~10%.

    “If the regulator is concerned about a market definition of streaming, then the Paramount merger is a lot easier to get through.”
    — Supino, 18:55

6. Deal Mechanics: Will Bids Escalate? Will Netflix Respond?

• Raising the Bid

  • WSJ reports Zaslav invited Paramount to raise its bid to $35/share to compensate for the Netflix break fee and sweeten the terms.

    “Zaslav invited paramount to offer 35…the Post’s opinion was that would cover the breakup fee payable to Netflix…”
    — Supino, 22:51

• Stock Collars and Market Sensitivity

  • Netflix’s offer includes a stock “collar”: if Netflix shares drop, WBD gets more stock to preserve value. But if Netflix’s stock underperforms, the justification for the merger could dissolve.

    “At lower Netflix stock prices, Netflix owes Warner more shares.”
    — Supino, 23:53

  • Supino: At a high enough price, shareholders would surely opt for Paramount, but the deal is close. Netflix’s lower “synergy” (i.e., layoffs) projection and “gentler” integration appeals to insiders.

7. Impact on Warner Bros., Hollywood, and the Market

• Morale and Creative Stability

  • The Netflix approach is less disruptive to the creative workforce, likely preserving more of Warner/HBO’s talent, thus keeping the business vibrant amid regulatory review.

    “That may be relevant to the political and regulatory review.”
    — Supino, 13:27

  • The risk of “brain drain” and chaos during years-long regulatory limbo is acute for Warner Bros., echoing previous, disruptive mergers.

    “If the Paramount deal ends up failing…all the studios have been anticipating being fired for two years, that’s a worse outcome…”
    — Supino, 25:13

8. Lightning Round: Who Should and Could Win?

• Paramount needs the deal more; Netflix doesn’t.

• But according to Supino, easier regulatory review in US/EU slightly favors Paramount.

  “Paramount should win this because Paramount is the easier regulatory review in the United States and in Europe. And they need it the most.”
  — Supino, 28:19

• Still, Netflix is now publicly motivated to “finish the job,” given their once-secret desire for WBD is out in the open.

  “Now that they’ve shown the world that they want it, the world will be concerned that they might also feel that they need it. The market’s now worried…”
  — Supino, 28:41

• Could this be an unforced error for Netflix? Not long-term—one or two good quarters would quickly restore market confidence.

9. Notable Quotes & Memorable Moments

• On the True Stake for “The Town”:

  “Everyone in town is like, which of these is better for me? That is the question everyone in town is asking.”
  — Belloni, 13:27

• On Hollywood Layoff Fears:

  “6 billion in synergies. Most of that comes from people getting fired, plain and simple.”
  — Belloni, 13:58

• On “ShitCo” and Cable Decline:

  “A reasonable range of estimates for ShitCo’s value is 1 to $3 per share…For a decade it has paid to take the under on all forecasts of anything in the cable network arena that wasn’t called ESPN.”
  — Supino, 07:26 & 08:27

• On Trump’s Involvement:

  “Maybe that’s what he think he’s projecting…What he’s actually projecting is: Where’s my piece? Where’s my cut? What are you gonna do for me?”
  — Belloni, 17:35

Timestamps for Important Segments

• [01:00] – Belloni lays out Ellison’s hostile bid, Netflix’s competing offer, and what’s at stake.
• [05:25] – Supino explains the bid timeline and potential communication breakdown.
• [07:04] – [10:29] – Deep-dive on the details and mechanics of each bid, including the crucial issue of “ShitCo” value.
• [12:03] – [15:43] – Hollywood's fear of layoffs, synergy numbers, job cuts, and the contrasting corporate cultures.
• [16:13] – [19:58] – Regulatory landscape, Trump’s unpredictable role, and Paramount’s vs. Netflix’s strategic advantages.
• [22:27] – [25:25] – Does Paramount need to raise its bid? Role of break fees, Netflix stock “collar,” and market impacts.
• [28:19] – [29:03] – Who should win and why? Paramount’s existential need for the deal versus Netflix’s strategic calculus.

Tone & Style

The conversation is fast, wonky, and laced with humor and Hollywood insider frustration, especially around “synergies” (code for layoffs), the “ShitCo” cable asset, and Trump’s opportunism. Belloni and Supino don’t pull punches on industry personalities or the brutal math at play for staffers and shareholders.

Bottom Line / For Listeners

If you haven’t listened:
This episode breaks down the business, political, and human drama behind two titans vying for Warner Bros. Discovery—why Paramount is fighting dirty, why Netflix’s first-ever “major buy” is so controversial, and why the outcome will shape not just a studio, but a whole industry. Want a primer for your holiday parties? This is your cheat sheet.

This summary skips over the ads, intro plugs, and podcast/award talk at the end, focusing exclusively on the business drama and its significance for the industry.