- Netflix (NASDAQ:NFLX) declined to raise its bid for Warner Bros. Discovery after the WBD board deemed Paramount Skydance’s higher US$31‑per‑share offer a “Superior Proposal”
- Paramount Skydance’s proposal offered stronger financial terms, including a major termination‑fee package, positioning it as the leading bidder for full acquisition of WBD
- Netflix emphasized its ongoing strength, noting the deal was “nice to have” but not essential, and reaffirmed plans for US$20B in content investment and resumption of share buybacks.
- Netflix stock (NASDAQ:NFLX) last traded at US$91.79
Netflix (NASDAQ:NFLX) has formally withdrawn from its bid to acquire major portions of Warner Bros. Discovery’s (NASDAQ:WBD), declining to raise its offer after WBD’s Board of Directors determined that a revised proposal from Paramount Skydance (NASDAQ:PSKY) constitutes a “superior proposal.” The decision effectively clears the way for Paramount Skydance to take control of the storied entertainment company.
WBD’s board notified Netflix earlier Thursday that Paramount Skydance’s updated all‑cash bid — now valued at US$31 per share — surpassed Netflix’s previously negotiated agreement, which was priced at US$27.75 per share. Netflix had four business days to respond under the terms of its existing merger agreement, but within hours, the company publicly announced it would not match the higher offer.
A statement in response from co-CEOs Ted Sarandos and Greg Peters called the deal “no longer financially attractive.”
“We believe we would have been strong stewards of Warner Bros.’ iconic brands, and that our deal would have strengthened the entertainment industry and preserved and created more production jobs in the U.S. But this transaction was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.”
A shifting media landscape
The Paramount Skydance proposal significantly reshapes the competitive landscape. With its US$31‑per‑share offer — alongside a US$7 billion regulatory termination fee and an agreement to cover the US$2.8 billion break‑up fee WBD would owe Netflix — Paramount Skydance positioned itself as the more attractive bidder both financially and strategically.
Paramount’s bid is for the entirety of Warner Bros. Discovery, including its cable networks (CNN, TNT, TBS), HBO, film studios, and global streaming operations. Netflix, by contrast, had sought to acquire only WBD’s studio, HBO, and streaming units.
WBD CEO David Zaslav praised Netflix publicly, calling the company “a great partner,” but noted that Paramount’s offer provided “superior value, certainty and speed to closing.” With shareholder approval pending, the WBD board is now expected to move forward with finalizing terms of the Paramount Skydance merger.
Netflix signals strength and refocuses on core growth
Netflix used its withdrawal to highlight its financial health. According to Sarandos and Peters, the company will invest approximately US$20 billion this year in original films and series and will resume its share repurchase program — a signal that leadership remains confident in organic growth over large-scale acquisitions.
Investor reaction was swift and positive. Netflix shares jumped in after‑hours trading following the announcement, suggesting shareholder relief that the company avoided overpaying amid escalating bidding tensions.
What comes next
A shareholder vote at WBD is scheduled for March 20, and regulatory review will follow. While the Paramount Skydance deal is not yet finalized, Netflix’s withdrawal removes the last major competing bid and simplifies the approval process.
If completed, the acquisition would consolidate a vast array of media brands — from HBO and Warner Bros. Pictures to CNN, Cartoon Network, and more — under the Paramount Skydance umbrella, marking one of the most consequential entertainment mergers in decades.
It’s on
Netflix is one of the leading entertainment services with almost 270 million paid members. It offers TV series, films and games across a wide variety of genres and languages.
Netflix stock (NASDAQ:NFLX) closed 10.99 per cent higher at US$$91.79 and has lost 14.56 per cent since this time last year, though this past week it has risen more than 10 per cent.
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