Netflix had initially considered buying Warner Bros. Discovery for $82.7 billion, but has now backed away from the deal. According to Netflix CEO Ted Sarandos, speaking with Bloomberg, the company decided the acquisition wasn’t necessary. He described the competing offer from Paramount Skydance as strange and illogical.
It will be interesting to watch how things develop. I’ve spoken extensively over the past two weeks about my vision for the future, and I’m optimistic that we won’t be negatively affected by recent events. In fact, these changes might even benefit us. However, I hope I’m wrong, because I want the best for the entire industry.
According to Netflix’s Ted Sarandos, Warner Bros. Discovery offered a rare chance to acquire a valuable asset – one they wanted, but didn’t necessarily need. Looking ahead, Netflix doesn’t plan any further acquisitions. Instead, the $2.8 billion they received from Paramount Skydance as a settlement will be used to fund internal growth. Sarandos emphasized that Netflix prefers to develop projects in-house, stating, “We are builders, not buyers,” and that remains their strategy.
I remember when Netflix decided not to buy Warner Bros. Discovery – it was a big deal! Ted Sarandos, the CEO, basically said the same thing then as he’s saying now. He and Greg Peters, the other CEO, explained that they only wanted it if the price was right, but they weren’t going to overpay just to have it. It wasn’t a deal they needed to make, just one that could have worked if the conditions were perfect.
We believed the deal we were discussing would have benefited our shareholders and likely been approved by regulators. However, to compete with the latest offer from Paramount Skydance, the price became too high. Because of this, we’ve decided not to proceed with a matching bid, as it no longer makes financial sense.
Paramount Skydance is set to buy Warner Bros. Discovery in a deal worth approximately $111 billion, valuing WBD shares at around $31 each. This acquisition would give Paramount complete ownership of Warner Bros. Discovery, encompassing its movies and studios, cable channels, and gaming studios like Warner Bros. Games.
When Netflix still included gaming, they hadn’t mentioned Warner Bros. Games in their public statements. While impressed with the games Warner Bros. Games had released, Peters considered the division to be relatively small overall. However, he expressed enthusiasm about potentially collaborating on properties like Hogwarts Legacy, noting Warner Bros. Games had strong studios and talented people. He clarified that they hadn’t factored this potential into their financial projections for the deal.
Paramount Skydance hasn’t announced what it intends to do with Warner Bros. Games yet. However, given the large amount of debt – roughly $78 billion – taken on with the acquisition, it’s possible Warner Bros. Discovery may have to reduce its workforce in the future.
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2026-03-02 19:11