Netflix Drops Out of Warner Bros. Bidding War as Paramount Nears Deal

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It appears Netflix won’t be buying Warner Bros. Discovery after all. According to reports, Netflix has decided not to increase its offer, clearing the way for David Ellison’s company to take ownership of the studio.

Netflix withdrew from the competition to acquire Warner Bros. because company leaders determined the deal was no longer financially viable. They considered Warner Bros. a desirable addition only if the price was right, but not essential regardless of cost.

Netflix has decided not to pursue a deal that was previously under negotiation. While the original agreement was expected to benefit shareholders and receive regulatory approval, the price needed to compete with the offer from Paramount and Skydance is too high, making the deal no longer financially viable, according to Netflix co-CEOs Ted Sarandos and Greg Peters.

We’d like to thank David Zaslav, Gunnar Wiedenfels, Bruce Campbell, Brad Singer, and the Warner Bros. Discovery Board for their thorough and fair evaluation. We were confident we could successfully manage Warner Bros.’ valuable brands, and that our proposed deal would have boosted the entertainment industry and supported more American production jobs. However, this deal was something we wanted if the price was right, but not something we needed to pursue regardless of cost.

Warner Bros. Deems Paramount’s Offer a “Superior Proposal” Over Netflix’s Bid

On Thursday, February 26th, Warner Bros. Discovery’s board announced that a new offer from David Ellison’s Paramount—worth $31 per share—was better than Netflix’s current bid. Netflix now has four days to make a counteroffer.

Warner Bros. Discovery (WBD) has informed Netflix that a competing offer, known as PSKY, is considered better than their current deal. This notification gives Netflix four business days to modify their existing agreement to regain the status of the preferred offer, according to a statement from the WBD board.

Simply put, Warner Bros. has chosen to accept Paramount’s latest proposal, giving Netflix a chance to offer the same terms. But since Netflix has decided it’s no longer interested, Warner Bros. and Paramount are now free to finalize their agreement.

Despite losing the deal, Netflix will still receive $2.8 billion. This is a termination fee that Paramount is paying because Warner Bros. was originally responsible for it after ending their previous agreement with Netflix.

Although it seems like the dispute between Warner Bros., Netflix, and Paramount is nearing a resolution, several obstacles remain before a final agreement is reached.

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2026-02-27 03:14