With a shareholder vote likely on the horizon, Paramount Skydance PSKY is unrelenting in its hostile tender offer to woo Warner Bros Discovery (WBD) WBD investors away from rival bidder Netflix NFLX.

The question now is how impatient large WBD investors will become with the board, especially considering Paramount offered them more for the WBD shares they recently purchased after Netflix announced its bid.

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In normal times, a corporate board focuses on long-term strategy — improving a company’s chances of surviving and competing over many years. Courts presume that this forward-looking stewardship ultimately benefits investors.

But the calculus changes once a company is put up for sale. At that point, the board’s legal duty narrows, and its main obligation becomes maximizing shareholder value. Paramount’s hostile takeover bypasses management entirely, appealing directly to investors and potentially putting shareholders’ preferences at odds with the board’s preferred transaction.

Since Netflix’s bid in early December, several investment funds have disclosed increased exposure to WBD’s stock, often as part of merger-arbitrage strategies betting on the deal’s completion or further bidding. The investor data are still rolling out, with 13F filings for the fourth quarter of 2025 not due until Feb. 14. But clearly, many investors went long WBD in December in anticipation of a sale. Will enough of them accept the $30-per-share offer later this month and give Paramount a controlling stake in WBD? It could happen.

The BlackRock Event Driven Equity Fund BILPX, for example, has increased its WBD holdings by 374% as of Dec. 31, while the Vanguard Windsor II Fund VWNFX increased its holdings by 15%, according to investment researcher Morningstar data.

Oakmark Funds, which owns around 3.8% of Warner Bros.’ outstanding shares according to Morningstar, said in a Dec. 31 note to clients: “We are pleased with the steps the WBD board has taken thus far to unlock shareholder value. We will continue to closely monitor developments as this bidding war unfolds.”

On Jan. 20, investor David Einhorn wrote in a letter to his firm’s investors that his Greenlight Capital bought WBD because of the dueling offers. They’re waiting for a deal to settle, with an expected final share price “in the low to mid $30s,” Einhorn wrote. That’s the Paramount number.

Both Oakmark and Greenlight sound like sellers. This type of investor cares about the spread between the bid and final price. They also care about regulatory risk. They don’t want long court battles.

The New York Post’s Charlie Gasparino reported earlier this month that Warner Bros. CEO David Zaslav wants Paramount to sweeten its $30-a-share bid. To get them to do that, he filed paperwork for an expedited “proxy” vote to approve Netflix’s $72 billion offer. Paramount is unlikely to increase its number. Gasparino’s take is that filing for an expedited proxy vote is about pressuring Paramount and its deal partners at RedBird Capital to provide more financial guarantees.

Deal offers have changed for both sides.

Netflix pivoted late last month to match Paramount’s all-cash deal worth $27.75 per WBD share for the streaming and studios assets. WBD’s board favors this proposal.

The fact that Paramount’s offer is for the entire company, meanwhile, signals that their deal might lead to a quicker closing for investors. Paramount this week extended the deadline of its tender offer to March 2. If enough shareholders tender at $30, Paramount could gain a larger stake in WBD and force the board into a fiduciary dilemma.

Some investors are taking Paramount’s offer, though the company is still far short of the 50% shares needed to gain effective control and force the WBD board to sell to Paramount. It is still early in the game, and early tenders in hostile bids are often small.

Since a number of these investors have bought in the fourth quarter because of bid rumors and Paramount’s higher dollar offer, they are into this stock for fast closure.

For its part, Washington keeps signaling that Netflix faces real regulatory risk. Netflix Chief Ted Sarandos and Warner Bros. Chief Revenue and Strategy Officer Bruce Campbell testified during a Feb. 3 Senate Judiciary Committee hearing about the deal.

Committee Chairman Mike Lee, a Republican from Utah, is already on record saying the deal “raised serious antitrust concerns.” Ranking Member Cory Booker, a Democrat from New Jersey, said in his opening remarks, “I believe that we are now seeing consolidation that is screwing Americans.”

Meanwhile, in the U.K., politicians urged the Competition and Markets Authority to review Netflix’s bid, saying it would reinforce Netflix’s dominance in the U.K. market. Members of the European Parliament and cinema associations are lobbying the European Commission to examine the deal.

Paramount can position its bid to shareholders as the “competitive counterweight” to both political risk and legal risk. If U.S. regulators really don’t want the country’s biggest filmed content streamer to own HBO and Warner’s studios, then they’ll ax the Netflix deal. Shareholders who tendered will join a class-action lawsuit against Netflix if their offer wins, leading to market uncertainty.

While Paramount buys time, the Netflix offer is moving further toward antitrust scrutiny. Any regulatory headlines will widen the risk gap between these two deals — giving Paramount the edge if investors compare that risk side-by-side.

Kenneth Rapoza is an analyst for the Coalition for a Prosperous America, which represents U.S. producers and workers. Rapoza has no positions in any of the stocks mentioned.

More: Warner Bros. gets an activist. Why it doesn’t like the Netflix deal.

Also read: Paramount still won’t raise price for Warner Bros. bid but offers billions in ‘enhancements’

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