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Netflix agreed to buy Warner Bros. Discovery in a $72 billion deal, the streaming service announced on Friday.
Under the deal, Netflix will acquire Warner Bros. Discovery’s film and television studios and streaming platform, HBO Max. Franchises, shows and movies such as “The Big Bang Theory,” “The Sopranos,” “Game of Thrones,” “The Wizard of Oz” and the DC Universe will join Netflix’s extensive portfolio.
The cash-and-stock deal is valued at $27.75 per Warner Bros. Discovery share, putting the equity value at $72 billion. The enterprise value – the total value of a company including debt – is $82.7 billion.
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The transaction is expected to close after Warner Bros. Discovery separates its streaming and studios and global networks divisions into two separate publicly traded companies, which is now expected to be completed in the back half of 2026.
“This acquisition will improve our offering and accelerate our business for decades to come,” Netflix co-CEO Greg Peters said. “Warner Bros. has helped define entertainment for more than a century and continues to do so with phenomenal creative executives and production capabilities.”
A sign is posted in front of Netflix headquarters on April 20, 2022, in Los Gatos, California. (Photo by Justin Sullivan/Getty Images)
Netflix said the deal will allow it to significantly expand U.S. production capacity and continue to grow investment in original content over the long term, which the company said will create jobs and strengthen the entertainment industry. Netflix also said it expects to maintain Warner Bros.’ current operations, which includes releasing movies in the theaters.
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Warner Bros. CEO David Zaslav said the deal “will ensure people everywhere will continue to enjoy the world’s most resonant stories for generations to come.”
The deal represents a major shift in the entertainment industry, reinforcing Netflix’s position as the most powerful distribution platform. It also stands as the largest merger announced this year.
Signage at a Warner Bros Discovery office in New York, US, on Saturday, Feb. 17, 2024. (Yuki Iwamura/Bloomberg via Getty Images)
However, the deal could face regulatory challenges as some lawmakers argue the merger would give Netflix too much control over content and distribution. Last month, after talks of a potential deal became public, Sen. Roger Marshall, R-Kansas, sent a letter to the Department of Justice and the Federal Trade Commission saying that a deal between the two companies would create one of the largest content consolidations in modern media history – hurting consumers, workers and competition across the entertainment marketplace.
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Paramount cut roughly 1,000 jobs on Wednesday. (Eric Thayer/Bloomberg via Getty Images)
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Paramount Skydance and Comcast reportedly entered the race to acquire some or all of Warner Bros. assets, submitting bids alongside Netflix this week.
But as talks continued, the head of Paramount, David Ellison, accused Warner of running an unfair process.
“It has become increasingly clear, through media reporting and otherwise, that WBD appears to have abandoned the semblance and reality of a fair transaction process, thereby abdicating its duties to stockholders,” Paramount’s attorneys at Quinn Emanuel wrote to the head of Warner, according to copies obtained by several outlets.
