Netflix, Inc. has agreed to acquire Warner Bros., encompassing its film, television, and streaming assets, under a proposed transaction valued at approximately $72 billion in equity value following the separation of Warner Bros. from the remainder of Warner Bros. Discovery. The deal would represent one of the largest media acquisitions in history and a transformative consolidation in the entertainment industry.
Background and Deal Terms
Under the terms of the agreement announced in early December, Netflix will purchase Warner Bros.’ major content assets, including its studios, production units, and streaming business previously known as HBO Max. The acquisition is structured as a cash-and-stock deal, under which Warner Bros. Discovery shareholders will receive a combination of cash and Netflix shares, with the total offer valuing Warner Bros. at approximately $27.75 per share and generating an enterprise value of roughly $82.7 billion when debt is included.
As contemplated, Warner Bros.’ legacy cable and linear television networks will be separated and spun off as a distinct publicly traded company, leaving the studios and streaming assets to be integrated into Netflix’s business. Pending regulatory and shareholder approvals, this separation and acquisition are expected to be completed in the third quarter of 2026.
Competitive Bidding and Hostile Offer
The Netflix deal emerged from a competitive bidding process in which multiple strategic buyers, including Paramount Skydance and Comcast, submitted rival proposals for Warner Bros. Discovery’s assets. Although Paramount Skydance subsequently launched a hostile takeover bid valuing the company at approximately $108.4 billion, Warner Bros. Discovery’s board of directors publicly reaffirmed its recommendation for shareholders to support Netflix’s offer, citing concerns about the structure and funding certainty of the rival bid (although Paramount has since revised its offer to include a personal guarantee from owner Larry Ellison).
Paramount’s all-cash proposal and its accompanying assertions about lower regulatory risk reflect broader shareholder pressure and corporate governance considerations inherent in high-profile transactions. Nonetheless, Warner Bros. Discovery’s leadership has emphasized that Netflix’s proposal best balances long-term strategic value with financial certainty.
Strategic and Industry Implications
For Netflix, the acquisition marks a significant departure from its historic “builders, not buyers” approach, representing a shift toward large-scale consolidation as a strategic growth pathway. By acquiring one of Hollywood’s most storied studios and a deep content library, including intellectual property franchises and premier original programming, Netflix positions itself to compete more directly with traditional media conglomerates and to expand its content offerings across platforms.
Industry analysts have noted that combining Netflix’s distribution reach with Warner Bros.’ content production capabilities could reshape competitive dynamics in entertainment and streaming media. At the same time, the transaction raises potential antitrust and regulatory considerations, given its scale and implications for content licensing, distribution, and market concentration. Regulatory authorities in the United States, the European Union, and other jurisdictions are expected to conduct thorough reviews as part of customary merger review processes.
The deal also underscores a broader trend of consolidation in the media landscape, with legacy film studios exploring strategic alternatives amid evolving consumer behavior and competitive pressures from digital platforms. If successfully completed, the acquisition may prompt further strategic transactions as industry participants seek scale and synergy to compete in an increasingly global content market.
Next Steps and Legal Considerations
The Netflix-Warner Bros. transaction remains subject to customary conditions, including approval by Warner Bros. Discovery shareholders and regulatory clearances from competition authorities. Legal and financial advisors will play central roles in navigating complex governance requirements, antitrust review standards, and cross-jurisdictional regulatory frameworks.
In addition, the existence of competing bids and ongoing negotiations highlights key legal issues related to fiduciary duties, bid protections (including breakup fees), and the rights of shareholders in contested acquisition scenarios. As the transaction progresses, litigation risk, shareholder challenges, and regulatory intervention are among the legal developments that practitioners and stakeholders will closely monitor.
This proposed transaction is still unfolding and subject to regulatory, shareholder, and competitive developments. Check back with Romano Law for the latest updates and analysis as this landmark media deal progresses.
Contributions to this blog by Kennedy McKinney.