The bidding war is over and Netflix is declared the winner.
After flirting with Paramount Skydance and Comcast, Warner Bros. Discovery (WBD) has decided to sell its streaming and film studio business to Netflix. If approved, the deal would shake up the media landscape and create waves that would impact Hollywood for years to come.
$72 billion acquisition
Netflix will pay $72 billion in equity for Warner Bros, or an estimated total enterprise value of $82.7 billion. The market value of all WBDs is $60 billion. NBC News notes.
The acquisition will take place after WBD completes separation of streaming and studio businesseswhich includes its film and television libraries, as well as HBO, as well as its other television networks, including CNN and TBS, into separate companies (Warner Bros. and Discovery Global, respectively). The UBD demerger is expected to be completed in the third quarter of 2026.
In addition, the Netflix acquisition is subject to regulatory approval, WBD shareholder approval and other “customary closing conditions.”
Netflix expects the acquisition to bring it more subscribers, higher engagement and “at least $2 billion to $3 billion in annual savings by year three,” the announcement said.
Netflix co-CEO Greg Peters said in a statement that Netflix will use its global reach and business model to bring WB content to a “wider audience.”
The announcement did not specify what this means for WBD's current staff, including current WBD President and CEO David Zaslav. Gunnar Wiedenfels, who is currently WBD's CFO, it is expected that there will be CEO of Discovery Global following the WBD split.
Netflix will own HBO Max
Netflix will have to overcome regulatory hurdles to complete this deal, which will transform it from a streaming king into an entertainment giant. If completed, the world's largest streaming service by subscribers (301.63 million as of January) would become the owner of its third-largest competitor (WBD has 128 million streaming subscribers, most of whom are HBO Max users).
