In a move that could reshape the entertainment landscape, Netflix has significantly increased its all-cash offer to acquire the studio and streaming business of Warner Bros. Discovery. The US-based streaming giant has now proposed to pay $27.75 (£20.64) per share in cash, up from the previous offer of $23.25 per share plus $4.50 worth of Netflix stock.
This revised bid aims to secure Warner Bros.’ extensive film and television library, as well as its premium HBO Max streaming service. The deal, if successful, would further consolidate Netflix’s position in the entertainment industry, potentially giving it access to a wealth of content and intellectual property.
The initial deal, announced in December, valued the Warner Bros. business at around $82.7 billion (£61.5 billion). However, Netflix’s share price has since dropped by almost 15%, leading the company to sweeten its offer in an attempt to secure the acquisition.
The revised terms have been deemed favourable for investors in Warner Bros. Discovery, according to analysts. Despite the improved financial offer, the company continues to back Netflix’s bid over a competing offer from Paramount Skydance, which had proposed $30 per share in cash for the entire Warner Bros. Discovery company, rather than just its studio and streaming division.
David Zaslav, the president and chief executive of Warner Bros. Discovery, expressed enthusiasm for the impending merger, stating that the combination of the two storytelling giants would ensure audiences continue to enjoy their content for generations to come.
Greg Peters, Netflix’s co-chief executive, underscored the strategic and financial benefits of the amended agreement, emphasizing the commitment to the transaction and the financial certainty it provides for Warner Bros. Discovery shareholders.
The agreed deal is contingent on Warner Bros. Discovery completing a proposed spin-off of its cable channels, including CNN, TBS, and TNT Sports in the UK.
