Los Angeles: In a seismic shift for the entertainment industry, Netflix announced Friday it has entered a definitive agreement to acquire Warner Bros. Discovery’s (WBD) film and television studios, along with its HBO Max streaming service, in a cash-and-stock deal valued at $82.7 billion (equity value of $72 billion). The move, which values WBD shares at $27.75 each, catapults Netflix into full vertical integration, blending its streaming dominance with Warner’s iconic franchises like “Game of Thrones,” “Harry Potter,” and DC superheroes Batman and Superman.
The acquisition follows a fierce bidding war against rivals Paramount Skydance and Comcast, with Netflix emerging victorious by offering a $5.8 billion breakup fee to sweeten the pot. Under the terms, WBD shareholders will receive $23.25 in cash and $4.50 in Netflix stock per share. The deal hinges on WBD first spinning off its cable networks, including CNN, TNT, and TBS, into a separate public company by Q3 2026, with full closure expected in 12-18 months.
Netflix CEO Ted Sarandos hailed the merger as a “game-changer,” promising to preserve Warner’s theatrical release tradition while unlocking $2-3 billion in annual synergies. “This unites two storytelling powerhouses, delivering unmatched content to global audiences,” Sarandos said in a statement. WBD CEO David Zaslav echoed the excitement, noting it would “amplify our legacy in the streaming era.”
Industry watchers predict ripple effects: enhanced leverage for Netflix in talent negotiations and potential mergers among smaller studios. However, theater chains and unions voiced concerns over market concentration, with the Directors Guild of America vowing to scrutinize antitrust implications. Shares of Netflix dipped 0.2% pre-market, while WBD surged 3%, trading below the offer price.
As streaming wars evolve, this blockbuster union signals Hollywood’s pivot from legacy cables to digital empires, potentially redefining content creation and distribution worldwide.