Warner Bros. Discovery (WBD) officially declared a revised $111 billion bid from Paramount Skydance to be a “Superior Proposal,” effectively ending the five-month bidding war for the legendary Hollywood studio.
The decision was finalized after Netflix, which had a pre-existing agreement to buy WBD’s studio and streaming assets for $82.7 billion, declined to match Paramount’s sweetened cash offer.
The Winning Deal: Paramount x Warner Bros.
Led by David Ellison and backed by the capital of his father, Oracle founder Larry Ellison, Paramount Skydance’s offer significantly outpaced the competition by targeting the entire company rather than just specific divisions.
- Purchase Price: $31.00 per share in cash (a 12% premium over the initial Netflix offer).
- Scope: Acquisition of 100% of WBD, including HBO, CNN, DC Studios, and the Discovery linear networks.
- Financial Commitments: * Paramount will pay a $2.8 billion breakup fee to Netflix on behalf of WBD.
- A record-breaking $7 billion regulatory termination fee if the merger fails to clear antitrust hurdles.
- A “ticking fee” of $0.25 per share each quarter if the deal isn’t closed by September 30, 2026.
Why Netflix Walked Away
Despite months of negotiations, Netflix co-CEOs Ted Sarandos and Greg Peters issued a joint statement on Thursday evening announcing their withdrawal:
“We’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive. This was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.”
Netflix will instead pivot back to its organic growth strategy, pledging to invest $20 billion in original content in 2026 and resuming its share buyback program.
What This Means for the Industry
The merger unites two of the “Big Five” Hollywood legacy studios, creating a media behemoth with unprecedented IP control.
| Combined Assets | Impact |
| Film & TV | Merges the homes of Top Gun, The Godfather, and Star Trek (Paramount) with Harry Potter, Succession, and DC (Warner). |
| Streaming | Expected consolidation of Paramount+ and Max into a single “super-streamer.” |
| News & Sports | Brings CBS News and CNN under a single corporate umbrella, raising significant questions about editorial independence. |
| The “Ellison Empire” | David Ellison becomes arguably the most powerful individual in Hollywood, with deep ties to the current Trump administration. |
Next Steps & Regulatory Hurdles
While WBD’s board has accepted the offer, the deal is far from over.
- Antitrust Scrutiny: Senators like Elizabeth Warren have already labeled the deal an “antitrust disaster,” and the DOJ is expected to perform a rigorous review of the consolidation of news and sports.
- Closing Window: Paramount expects the transaction to officially close between September 30 and December 31, 2026.
