Paramount set to own Warner Brothers after "superior" bid over Netflix agreement

On December 5, 2025, Netflix published an official announcement according to which the streaming platform fully negotiated and financed a definitive agreement to acquire Warner Bros. including its film and television studios, HBO Max and HBO. The cash and stock transaction was valued at $82.7 billion (equity value of $72 billion).  However, this actually was not a definitive agreement, as the bidding for WBD remained open, with Paramount Skydance continuing to make offers in the meantime. On February 26, the Warner Bros. Discovery board deemed Paramount’s latest bid “superior” to the initial Netflix agreement. This higher bid would see Paramount Skydance acquiring 100% of WBD for approximately $111 billion. Netflix refused to counter with a higher offer and Paramount now looks poised to completely own WBD.

Paramount’s latest bid also stipulates that the regulatory termination fee would be increased to $7 billion in the event the transaction does not close due to extended regulatory scrutiny. Additionally, and most importantly, Paramount offers to pay Netflix the $2.8 billion termination fee to terminate the Warner Bros. merger agreement with Netflix. And, as a courtesy, Paramount would also eliminate WBD’s potential $1.5 billion financing cost triggered by the debt exchange offer.

The latest bid from Paramount has a high chance to succeed as the  WBD board now only needs to determine that Paramount’s revised proposal is a “Company Superior Proposal” under its merger agreement with Netflix. Nevertheless, US and European antitrust agencies as well as the US DoJ will have the last word.

While the Netflix acquisition was raising concerns for the fate of WB's movie IP theatrical releases, the Paramount merger now raises concerns related to political propaganda since Paramount Skydance is owned by Larry Ellison and his son David, who are prominent Republican donors and have close ties to US President Donald Trump. Paramount is interested in owning CNN and all the Discovery TV channels, unlike Netflix.

In order to finalize the $111 billion deal, Paramount needs to borrow money from three Arabic sovereign wealth funds, RedBird Capital and banks like Citi and Apollo that already loaned $57.5 billion.