Paramount Skydance is set to take over Warner Bros Discovery in a deal valued at about $111 billion after Netflix withdrew from the bidding, ending a months-long battle for one of Hollywood’s most prominent studios.
Warner Bros, which put itself up for sale last year, said on Thursday that Paramount’s revised offer was “superior” to Netflix’s proposal, which the streaming giant declined to increase. Netflix executives said the deal was no longer financially attractive at the higher price.
If approved, the acquisition would give Paramount control of Warner Bros’ film studio and major media assets, a move expected to significantly reshape the global entertainment industry.
Netflix had earlier reached an agreement in December to buy parts of Warner Bros in a deal worth around $82 billion including debt. Paramount later entered the race with a rival bid, initially rejected, before returning this week with a sweeter offer that increased the cash price per share.
Netflix co-chief executives Ted Sarandos and Greg Peters said the company remained disciplined, noting the transaction was never essential at any cost.
Regulatory hurdles remain. California Attorney General Rob Bonta said the proposed merger is still subject to scrutiny, with the state’s Department of Justice reviewing the deal. Approval would also be required from the US Department of Justice and European regulators.
The potential takeover has drawn particular attention because Warner Bros owns CNN, one of the United States’ largest news networks. A merger with Paramount could have major implications for the channel’s future.
Paramount is backed by tech billionaire Larry Ellison and led by his son David Ellison. The financing of the bid has attracted scrutiny due to Ellison’s close ties with US President Donald Trump, who has frequently criticised CNN’s coverage.
David Ellison welcomed the Warner Bros board’s decision, saying the enhanced proposal offers shareholders greater value and certainty, with a faster path to completion.
If regulators give the green light, Paramount would absorb Warner Bros’ HBO Max streaming subscribers and take ownership of brands including CNN, the Food Network and various sports properties, adding them to its existing portfolio that includes CBS, Nickelodeon and Comedy Central.
Industry observers say the sale of Warner Bros is likely to have far-reaching consequences across Hollywood, including possible job cuts, as studios adjust to further consolidation in an industry already facing major structural changes.
With inputs from BBC