The board of Warner Bros. Discovery (WBD) is expected to reject Paramount Skydance's revised takeover offer, opting instead to proceed with its previously established merger agreement with Netflix, according to a report by Bloomberg News on Tuesday. The decision, anticipated to be formalized through a board vote next week, signals WBD's commitment to a strategic alliance with the global streaming giant, a deal valued at over $80 billion.

Paramount Skydance, led by David Ellison, had presented an amended offer on Dec. 22, seeking to acquire assets considered vital for establishing a prominent position in the evolving landscape of 21st-century Hollywood. However, sources familiar with the matter indicate that the WBD board views the Netflix merger as a more advantageous path forward, despite Ellison's persistent pursuit.

The potential merger between WBD and Netflix represents a significant consolidation within the global media industry, reflecting the increasing importance of streaming services in content distribution and consumption. For Netflix, acquiring WBD would provide access to a vast library of film and television content, strengthening its position against competitors such as Disney+ and Amazon Prime Video in markets worldwide, including Europe, Asia, and Latin America. WBD, in turn, would benefit from Netflix's extensive subscriber base and technological infrastructure, enabling it to reach a broader global audience.

The decision comes at a time when media companies are grappling with the challenges of adapting to changing consumer habits and the rise of digital platforms. Traditional media conglomerates are facing increasing pressure to compete with tech giants that have invested heavily in content creation and distribution. The WBD-Netflix merger reflects a strategic response to these challenges, aiming to create a more competitive entity in the global media market.

The rejection of Paramount Skydance's offer underscores the complexities of navigating mergers and acquisitions in the media industry, where strategic considerations often outweigh financial incentives. The WBD board's decision suggests a belief that the long-term benefits of aligning with Netflix outweigh the potential advantages of a deal with Paramount Skydance. The formal vote next week will solidify WBD's commitment to the Netflix merger, setting the stage for a significant transformation in the global media landscape.