COMPETITIVE · USA
Netflix–Warner Bros. deal termination and Paramount Skydance acquisition of Warner Bros. Discovery
Change
Warner Bros. Discovery signed a $110B acquisition agreement with Paramount Skydance on Friday, and Netflix confirmed it is terminating its agreement with Warner Bros. while receiving US$2.8B from Paramount.
Why it matters
A definitive agreement was signed Friday for Paramount Skydance to acquire Warner Bros. Discovery in a reported $110B deal, replacing the prior scenario where Warner’s board was evaluating whether Paramount’s revised offer could be a “superior proposal” and had set Netflix a four-day response deadline. Netflix separately confirmed it would not raise its offer and is terminating its agreement with Warner Bros. The excerpt states Netflix will receive US$2.8B from Paramount, creating an immediate, quantified transfer tied to the new deal structure. Public-market reaction was sharp (Netflix up ~14%, Paramount up ~20%, Warner down ~2.1% after a large six-month run), indicating rapid repricing of deal and contract outcomes.
Implications
- • Warner Bros. Discovery’s ownership/control shifts under a signed $110B agreement
- • Netflix–Warner contractual relationship changes via confirmed termination
- • US$2.8B payment from Paramount to Netflix alters near-term cash flows
- • Competitive bidding leverage implied by the four-day deadline is effectively closed
Who is affected
- • Warner Bros. Discovery shareholders and board
- • Paramount Skydance deal team, lenders, and integration leadership
- • Netflix corporate development/licensing teams and investors
- • Counterparties to Warner/Paramount content and distribution agreements
Source
Topics
Business & Markets Mergers & Acquisitions Finance & Banking Capital Markets