Netflix has withdrawn from its bid to acquire Warner Bros. Discovery’s studio and streaming assets, effectively clearing the path for Paramount Global to secure a deal, the companies announced Thursday and Friday.
The decision, revealed in a statement from Netflix co-CEOs Ted Sarandos and Greg Peters, came after Warner Bros. Discovery’s board indicated it considered Paramount’s offer “superior” to Netflix’s initial $83 billion proposal, according to reporting from NPR and the New York Times. “We’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid,” the Netflix statement read.
Paramount’s latest proposal values Warner Bros. Discovery at $31 per share, along with a quarterly “ticking fee” of $0.25 per share beginning in September 2026, and a $7 billion regulatory termination fee should the deal fail to gain regulatory approval. Paramount has also agreed to cover Warner Bros. Discovery’s $2.8 billion termination fee owed to Netflix for ending their previous agreement.
David Ellison, CEO of Paramount, stated prior to Netflix’s withdrawal that the Warner Bros. Discovery board had “unanimously affirmed the superior value of our offer, which delivers to WBD shareholders superior value, certainty and speed to closing.”
The potential acquisition, however, faces scrutiny from regulators in the U.S. And Europe. Senator Elizabeth Warren has already labeled the deal an “antitrust disaster,” raising concerns about further consolidation in the media industry. Ellison may be called before Congress to address these concerns, according to reports.
The shift in negotiations follows a period of intense competition, with Netflix initially appearing poised to acquire a significant portion of Warner Bros. Discovery’s entertainment holdings. Sarandos had publicly challenged Paramount to increase its offer, stating, “If you wanna try and outbid our deal … just make a better deal. Just position a better deal on the table,” as reported by NPR.
Despite backing out of the Warner Bros. Deal, Netflix emphasized its continued financial strength and commitment to content creation. “Netflix’s business is healthy, strong and growing organically, powered by our slate and best-in-class streaming service,” Sarandos and Peters said. “This year, we’ll invest approximately $20 billion in quality films and series and will expand our entertaining offering.”
The outcome leaves Paramount as the frontrunner to acquire Warner Bros. Discovery, but the deal is not yet final. Regulatory approval remains a significant hurdle, and the deal could still face opposition from state attorneys general.
