Netflix announced on Friday that it will acquire Warner Bros. Discovery in a cash-and-stock deal valued at $27.75 per share, giving the transaction a total enterprise value of roughly $82.7 billion.
The agreement comes after a competitive bidding process that lasted several weeks. Netflix outbid Paramount Skydance’s nearly $24-per-share proposal with its higher offer of almost $28. Trading in Warner Bros. Discovery shares was halted ahead of the news.
Under the terms of the deal, Warner Bros. Discovery shareholders will receive $23.25 in cash and $4.50 in Netflix stock for each share they own. The acquisition is expected to close within 12 to 18 months. This timeline follows the planned separation of WBD’s Global Networks division into a new publicly listed company called Discovery Global.
The merger will unite Netflix’s global streaming platform with Warner Bros.’ major entertainment franchises, including “Game of Thrones,” “DC Comics,” and “Harry Potter.” The combination significantly strengthens Netflix’s position in Hollywood and reshapes the competitive landscape.
Netflix co-CEO Ted Sarandos said the acquisition supports the company’s mission to “entertain the world,” adding that the blend of Warner Bros.’ extensive library with Netflix’s catalog will enhance content offerings for viewers.
Warner Bros. Discovery CEO David Zaslav called the agreement a union of “two of the greatest storytelling companies in the world,” highlighting the potential to reach even more audiences.
Netflix plans to continue Warner Bros.’ existing operations, including theatrical film releases. The company expects to generate $2–3 billion in annual cost savings by the third year and projects that the deal will boost earnings per share by the second year.
However, the acquisition is likely to undergo intense antitrust scrutiny in both the United States and Europe. Owning HBO Max and its nearly 130 million subscribers would give Netflix even greater dominance in the streaming industry.
To address regulatory concerns, Netflix argues that merging its service with HBO Max could reduce costs for consumers through more affordable bundled offerings.
Meanwhile, Paramount, led by David Ellison, challenged aspects of the sale process earlier this week. The company claimed in a letter that Netflix received preferential treatment during negotiations.
Warner Bros. Discovery closed at $24.50 per share on Thursday, giving the company a market capitalization of about $61 billion prior to the announcement.
