The key to acquire Warner Bros. in $110B deal after Netflix pulls out
Paramount Skydance has agreed to acquire Warner Bros. Discovery in a $110 billion deal signed Friday morning, marking the biggest bidding war ever seen at Netflix.
According to an internal town hall reviewed by Reuters, Warner Bros. executives confirmed that Netflix had the legal right to match Paramount Skydance's offer, but ultimately declined. That decision paved the way for an agreement signed with PSKY.
Shares of Paramount Skydance rose nearly 20 percent on the news, while Netflix jumped 13 percent as investors welcomed the decision to exit the regulatory bidding war.
Paramount's latest bid of $31 per share for Warner Studios and streaming assets is believed to be higher than Netflix's $27.75 per share proposal. The revised offer included tougher deal safeguards, with Paramount increasing its regulatory severance payment from $5.8 billion to $7 billion and agreeing to cover Warner's $2.8 billion break in debt to Netflix.
The transaction, which includes nearly $29 billion in debt, is one of the largest media deals in recent years and will combine major film and streaming assets under one umbrella.
Paramount gained access to Warner's intellectual property portfolio, including franchises such as Fantastic Beasts and The Matrix.
Regulatory review remains in focus. EU antitrust approval is expected to be manageable, although California's attorney general has launched an investigation into the transaction.
