As competition in the global streaming business heats up, Netflix has sweetened its bid for the studios and streaming assets of Warner Bros Discovery (WBD) by switching to an all-cash offer, even as rival Paramount Skydance pushes a hostile takeover. Netflix’s $82.7bn (around ₹7.5 lakh-crore) offer highlights the growing consolidation in the global media industry.
Netflix’s revised plan to buy WBD’s studios and streaming business keeps the same price of $27.75 per share, but changes the deal to all cash instead of a mix of cash and shares. Netflix said this makes the deal easier to complete, gives WBD shareholders more clarity on the value they will receive, and speeds up the process. A shareholder vote could now take place as early as April.
Netflix co-chief executive Ted Sarandos said the all-cash deal would allow a faster vote and give investors clear value at $27.75 per share in cash, along with the value from spinning off Discovery Global. He added that WBD’s board continues to fully back the deal and believes it is best for shareholders, viewers and the wider entertainment industry.
If the deal goes through, Netflix will take over WBD’s film studios and streaming platforms. However, WBD’s global TV networks — such as CNN, Cartoon Network and Discovery Channel — will be split into a separate company, which Netflix is not buying.
The battle has intensified as Paramount has made a rival offer worth $108.4bn to buy the entire WBD group. Paramount has taken a hostile approach, trying to put its own directors on WBD’s board and challenge the board’s strong support for the Netflix deal.
Last week, Paramount also went to court seeking access to financial details linked to the Netflix agreement, but a Delaware judge rejected the case. Paramount now wants to convince WBD shareholders to replace current board members and back its proposal. It is also pushing for a rule change that would require shareholder approval for the planned spin-off of WBD’s global networks.
WBD’s board has twice asked shareholders to reject Paramount’s bid, calling it inadequate and warning that its debt-heavy structure is risky. If WBD were to drop the Netflix deal, it would have to pay a $2.8bn breakup fee. Paramount has raised its own termination fee to $5.8bn to match Netflix’s.
WBD has said that choosing Paramount’s offer could still cost the company about $4.7bn once breakup fees, higher interest costs and other penalties are added, showing how complex and high-stakes the takeover fight has become.
