The bidding war has concluded, and Netflix has emerged victorious.
After considering offers from Paramount Skydance and Comcast, Warner Bros. Discovery (WBD) chose to sell its streaming and movie studios business to Netflix. This landmark deal, pending approval, is expected to reshape the media landscape and leave a lasting impact on Hollywood.
$72 Billion Acquisition:
Netflix will acquire Warner Bros. for an equity value of $72 billion, with the total enterprise value estimated at approximately $82.7 billion. Currently, NBC News places the market value of WBD at $60 billion.
The transaction will proceed once WBD completes the division of its streaming and studios components, encompassing film and TV libraries, the HBO channel, and other TV networks like CNN and TBS, into separate entities named Warner Bros. and Discovery Global, respectively. This split is anticipated to conclude by the third quarter of 2026.
Moreover, the acquisition is contingent on receiving regulatory approvals, gaining WBD shareholder approval, and meeting other standard closing conditions.
Netflix anticipates the purchase will lead to increased subscribers, enhanced engagement, and cost savings of $2 to $3 billion annually by the third year, according to their announcement.
Greg Peters, Netflix's co-CEO, stated that Netflix intends to leverage its global reach and business model to present Warner Bros. content to a wider audience.
The announcement did not clarify the implications for existing WBD employees, including its current President and CEO, David Zaslav. However, Gunnar Wiedenfels, WBD's CFO, is expected to lead Discovery Global following the split.
Netflix to Own HBO Max:
The deal, if finalized, will transform Netflix from the leading streaming service to a dominant force in entertainment. As of January, Netflix holds the top position in global subscriber numbers at 301.63 million. Acquiring WBD, its third-largest rival with 128 million streaming subscribers (primarily from HBO Max), would significantly bolster its market position.