Netflix announced Thursday that it will no longer pursue its planned transaction with Warner Bros Discovery after the target company’s board signaled preference for Paramount Skydance’s latest proposal. The development ends a period of competition between rival bidders for Warner Bros, shifting the outlook for M&A activity in the media and entertainment sector.
Warner Bros Discovery’s board, following advice from independent legal and financial counsel, concluded that the revised Paramount Skydance offer represented a financially superior alternative under the existing terms with Netflix. Paramount Skydance’s latest proposal includes a cash consideration of $31 per Warner Bros share along with a daily ticking fee of $0.25 per share per quarter beginning after September 30, 2026.
As part of the Paramount Skydance offer, a regulatory breakup fee of $7 billion would be payable if the deal does not proceed due to regulatory issues. Should Warner Bros terminate its agreement with Netflix to accept the new offer, Paramount Skydance would also cover the $2.8 billion termination payment owed to Netflix.
Netflix stated the partnership would only have proceeded under financially disciplined terms and was not essential at any cost. The company emphasized that its current content pipeline and streaming business support continued organic growth. Netflix plans to maintain strong investments in new programming, targeting around $20 billion in content spending this year, and will also resume stock buybacks.
