Netflix has withdrawn from its bid to acquire a majority stake in Warner Bros. Discovery, effectively clearing the path for Paramount Skydance to pursue a $110 billion takeover, Warner Bros. Discovery announced Thursday.
The decision by Netflix co-CEOs Ted Sarandos and Greg Peters came after Warner Bros. Discovery’s board informed them that Paramount Skydance’s offer of $31 per share constituted a “superior proposal,” according to a statement released by Netflix. “The transaction we negotiated would have created shareholder value with a clear path to regulatory approval,” the CEOs said. “However, 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.”
Paramount Skydance, led by chairman and CEO David Ellison, initially offered $30 a share in all cash for Warner Bros. Discovery before raising its bid to $31 per share on Tuesday. The revised offer values the deal at approximately $110 billion. Ellison stated that the merger would benefit viewers, investors, and other stakeholders. “By bringing together these world-class studios, our complementary streaming platforms and the extraordinary talent behind them, we will create even greater value for audiences, partners and shareholders — and we couldn’t be more excited for what’s ahead,” he said.
Warner Bros. Discovery President and CEO David Zaslav echoed Ellison’s sentiment, stating the company aimed to “secure a transaction that maximizes the value of our iconic assets and our century-old studio while delivering as much certainty as possible for our investors.”
The potential merger, which began taking shape in October when Warner Bros. Discovery began exploring a sale after receiving unsolicited interest, represents a significant shift in the entertainment landscape. Netflix initially agreed in December to acquire part of Warner Bros. Discovery for $27.75 a share, or $82.7 billion, but was ultimately outbid. Paramount’s acquisition was significantly backed by its chairman and CEO Ellison, and his father, Larry Ellison, the chairman of Oracle and one of the world’s wealthiest individuals.
While the deal now appears poised to proceed, it still requires formal approval from Warner Bros. Discovery’s board of directors and is expected to face scrutiny from regulators. The combined entity would control a vast portfolio of assets, including studios, streaming platforms like HBO Max and Paramount+, and television networks such as CNN and HGTV.
