Netflix to acquire Warner Bros Discovery in $82.7 billion deal

Netflix is set to solidify its global streaming position by acquiring Warner Bros Discovery for $82.7 billion, excluding debts. The massive deal, which was revealed after a weeks-long bidding war, sees the streaming pioneer taking control of one of Hollywood’s most prized and historic assets.

The acquisition, announced on Friday, follows a competitive bidding period in which Netflix surged ahead with a nearly $28-per-share offer.

This bid was higher than the nearly $24-per-share offer from rival Paramount Skydance for the entirety of Warner Bros Discovery, which included its cable TV assets, now slated for a separate spinoff. 

However, Warner Bros Discovery’s shares had closed at $24.50 on Thursday, giving the company a market value of $61 billion before the deal was finalised.

During the bid, the streaming giant’s shares dropped nearly 3% in pre-market trading, and rival bidder Paramount’s shares fell 2.2%. Meanwhile, the third interested party, Comcast, saw little change in its stock price. 

Under the terms of the deal, each existing Warner Bros Discovery shareholder will receive a payout valued at $27.75 per share. This payout consists of $23.25 in cash and approximately $4.50 in Netflix stock. 

This equates to the total equity value of the acquisition being $72 billion, with the entire transaction valued at about $82.7 billion when WBD’s existing debt is included.

According to media reports, the deal is expected to close after Warner Bros Discovery spins off its global networks unit, Discovery Global, into a separate listed company, a move now set for completion in the third quarter of 2026.

The streaming giant is expected to generate at least $2 billion to $3 billion in annual cost savings by the third year, after the deal closes.

This acquisition would further increase the power balance in Hollywood in favour of the streaming giant.

By buying the owner of marquee franchises, including Game of Thrones, DC Comics, and Harry Potter, Netflix, which initially built its dominance without major acquisitions, strengthens its efforts to ward off competition from rivals like Walt Disney and the Ellison family-backed Paramount.

“Together, we can give audiences more of what they love and help define the next century of storytelling,” Ted Sarandos, co-CEO of Netflix, said.

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What this means for Netflix users

The acquisition of Warner Bros Discovery’s TV and streaming assets by Netflix is a massive win for the consumer globally. While the deal won’t close until late 2026, the long-term changes for users could offer more content and potential cost benefits.

However, analysts familiar with the story said that by locking up these long-term content rights, Netflix will become less reliant on outside studios for its biggest hits, which is a key strategic move.

This content haul is especially crucial as the company pushes into new business areas, such as video gaming, and looks for new ways to grow after successfully cracking down on password sharing among users.

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The most immediate and obvious benefit for Netflix users will be the unprecedented expansion of the content library. By absorbing the WB assets, Netflix gains exclusive control over some of the most iconic and valuable franchises in entertainment history.

This means Netflix’s catalogue will now include the entire libraries of HBO and HBO Max with shows like Game of Thrones, Succession, and The Sopranos.

For users currently subscribed to both Netflix and HBO Max, the acquisition could lead to a single, combined subscription, eliminating the need to pay for and manage two separate services.

By consolidating all this premium content, Netflix will have more flexibility to create different tiers, offering users more choices in how they access the combined library.

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