Rival bids for Warner Bros. face competition scrutiny: a Postscript
A previous post detailed how Netflix and Paramount Skydance were competing to acquire part or all of Warner Bros. Discovery (WBD). In December 2025, Netflix announced that it had agreed a deal to buy WBD’s studio and streaming service business. However, Paramount has still pursued a hostile takeover of WBD.
In mid-February 2026, it emerged that WBD had reopened talks with Paramount. Paramount was given a week to make its final offer. Then, under the agreed deal, Netflix would have the right to adjust its bid. Things have developed quickly since then.
Paramount raised its offer price by $1 per share making the deal worth a total of $111bn. WBD stated that this was superior to Netflix’s offer and Netflix declined to increase its bid. Netflix executives stated that:
This transaction was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.1
Paramount will also pay Netflix the $2.8bn fee WBD owes Netflix for terminating the deal.
Whilst it appears Paramount has won the race to acquire WBD, the deal still needs regulatory clearance from competition authorities in the USA and Europe. Paramount CEO, David Ellison, stated that the proposal offered WBD shareholders ‘superior value, certainty and speed to closing.’2
Should the deal go through, the merged company would be in a powerful position as one of the few remaining Hollywood film and television studios.
References
- Paramount set for $111bn Warner Bros takeover after Netflix drops bid
- Ibid
BBC News, Danielle Kaye and Nardine Saad (26/2/26)
Articles
- Paramount set for $111bn Warner Bros takeover after Netflix drops bid
- Paramount acquires Warner Bros Discovery in mega deal: the winners, losers and Trump’s man in the middle
- Netflix and Paramount bidding for a potentially lucrative back catalogue mirrors 18th‑century publishing deals
- Paramount-Warner Bros mega-merger could still face ‘real threats’, antitrust experts say
BBC News, Danielle Kaye and Nardine Saad (26/2/26)
The Conversation, Liam Burke (3/3/26)
The Conversation, Marrisa Joseph (5/3/26)
The Guardian, Jeremy Barr (5/3/26)
Questions
- What are the similarities and differences between Netflix’ and YouTube’s business models? How close substitutes do you think they are?
- Do you think cinemas are a closer or more distant substitute to Netflix than YouTube?
- Which of the possible deals, do you think, raised the most competition concerns? What might be a possible remedy that could alleviate these concerns?
- Was WBD’s decision to accept the Paramount takeover purely determined by the size of Paramount’s bid?
- What is the significance of legacy assets to the acquisition of WBD?