Netflix has agreed to acquire Warner Bros. Discovery’s TV and film studios along with its streaming division in a deal worth $72 billion US. This acquisition will transfer control of one of Hollywood’s esteemed and long-standing assets to Netflix, a streaming giant that has revolutionized the media landscape.
The agreement, announced on Friday, culminated after a competitive bidding process where Netflix outbid Paramount Skydance with a price of nearly $28 per share, surpassing the rival’s offer of close to $24 per share for the entirety of Warner Bros. Discovery, including the cable TV assets earmarked for a separate spinoff.
Following the announcement, shares of Warner Bros. Discovery rose by 6.3% during Friday’s trading session, while Netflix shares closed 2.9% lower and Paramount Skydance saw a decline of 9.8%.
The acquisition of Warner Bros. Discovery, known for iconic franchises such as “Game of Thrones,” DC Comics, and “Harry Potter,” is set to further solidify Netflix’s position in Hollywood. Despite its historical success with multiple best-picture winners at the Academy Awards like “Casablanca,” “My Fair Lady,” “Unforgiven,” and “The Departed,” Warner Bros. will now join forces with Netflix, as highlighted by David Zaslav, CEO of Warner Bros. Discovery.
Although the deal promises significant synergies, it is likely to encounter rigorous antitrust scrutiny in both Europe and the U.S. due to the substantial market dominance it would offer Netflix, which already boasts nearly 130 million streaming subscribers and would now also gain ownership of HBO Max. This has raised concerns among industry stakeholders, including Cinema United, which expressed worries about the impact on movie theaters globally.
Amidst regulatory challenges, various Hollywood creators and trade associations have voiced their apprehensions. However, Netflix has reassured stakeholders that the deal aims to benefit consumers by potentially lowering bundled offering costs through a combination of its streaming service with HBO Max. Additionally, Netflix has committed to continue releasing Warner Bros. studio films in cinemas to allay fears of diminishing diversity in the theatrical film landscape.
As the deal progresses, it is expected that regulatory approvals and shareholder consent will pave the way for the transaction to be finalized. Warner Bros. Discovery shareholders are set to receive a combination of cash and Netflix stock per share, valuing the deal at $72 billion in equity and $82.7 billion, including debt.
The completion of the deal is contingent on Warner Bros. Discovery’s spinoff of its global networks unit, Discovery Global, into a separate listed entity, anticipated to be concluded in the third quarter of 2026. This strategic move aligns with Warner Bros. Discovery’s prior plans to segregate its cable and streaming offerings, with HBO, HBO Max, Warner Bros. Television, and other entities forming a new streaming and studios company.
Despite concerns raised by industry figures and lawmakers, the impact of the Netflix-Warner Bros. deal on Canadian viewers remains uncertain. Notably, Warner Bros. Discovery currently licenses HBO content to Crave, a subscription service offered by Bell Media under an exclusive multi-year agreement since 2024.
While the deal’s potential implications are subject to ongoing scrutiny and debate, the evolving media landscape and changing consumer preferences continue to shape the future of the entertainment industry.