Netflix has pulled out of the bidding war for Warner Bros. Discovery (WBD), effectively clearing the path for Paramount Skydance to take the lead in the high-profile takeover contest.
Netflix had previously offered $27.75 per share for Warner’s studio operations and HBO Max streaming business, valuing those assets at approximately $83 billion, including debt. However, Paramount Skydance tabled a higher final offer of $31 per share for the entire WBD group, valuing the company at about $111 billion, including debt.
Although Warner’s board had initially continued to recommend Netflix’s proposal, it acknowledged that Paramount’s bid now represented a “superior” offer — marking the first sign of support for what had previously been considered a hostile bidder.
Within hours of that assessment, Netflix confirmed it would not raise its bid, stating the transaction was “no longer financially attractive.” Co-CEOs Ted Sarandos and Greg Peters said in a joint statement: “This was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.”
Despite Netflix’s withdrawal, the takeover is not yet finalised. Warner’s board has not formally approved Paramount’s offer, though CEO David Zaslav described the proposal as one that could create “tremendous value.”
Any deal would still require shareholder and regulatory approval, with competition concerns and potential political scrutiny expected to feature prominently in the review process.
If successful, the merger would bring major media assets, including CNN and CBS News, under one corporate umbrella, intensifying debate about consolidation in the US news and entertainment industry.
Paramount Skydance is chaired and led by David Ellison, son of billionaire Larry Ellison, who is backing the financing of the bid.
Investors reacted swiftly to the news. Netflix shares rose 8.5% in after-hours trading, while Paramount’s stock climbed 6.2%. Meanwhile, WBD shares slipped nearly 2% to $28.80 — below Paramount’s $31 offer price.
Analysts noted that Netflix’s decision reflected financial discipline rather than retreat, allowing investors to refocus on the company’s profitability and operational performance.
Should Paramount Skydance succeed, the combined entity would unite two major Hollywood studios, merging franchises such as Harry Potter, Superman, and Barbie with Paramount’s portfolio, including Top Gun and The Godfather, alongside the Paramount+ streaming platform.
For now, while the bidding war appears to have settled, regulatory and shareholder hurdles remain before what could become one of the largest media mergers in recent years is finalised.
