Paramount Skydance Corporation’s all‑cash offer of $31 per share values Warner Bros. Discovery, Inc. at an enterprise worth roughly $110 billion, including an equity value of $81 billion. The deal includes a $2.8 billion breakup fee payable to Netflix and a $7 billion termination fee that Paramount will pay if regulatory approval is not obtained. The parties expect the transaction to close in the third quarter of 2026, subject to regulatory and shareholder approvals.
The merger will combine Paramount’s Paramount+, HBO Max, and Discovery+ streaming platforms with Warner Bros. Discovery’s extensive film and television library, which includes franchises such as Harry Potter, The Matrix, and DC Universe, as well as major cable networks like CNN, TBS, and TNT. The combined entity will also control a broad portfolio of sports rights, including the NFL, Olympics, and NBA, positioning it as one of the largest media conglomerates in the United States and a stronger competitor to Netflix, Disney, and Amazon in the streaming wars.
WBD’s Q4 2025 results showed total revenue of $9.5 billion, a 7% ex‑FX decline from the prior year, and adjusted EBITDA of $2.2 billion, down 20% year‑over‑year. Paramount reported Q4 2025 revenue of $8.15 billion, a 5.1% decline, and a GAAP loss of $0.52 per share, with an operating margin of –4.2%. The acquisition is expected to generate more than $6 billion in synergies, helping both companies offset the headwinds seen in their recent earnings reports.
Investors reacted positively to Netflix’s withdrawal from the bidding process, while Warner Bros. Discovery’s market response was tempered by concerns over regulatory scrutiny. The deal is expected to reshape the competitive landscape of the media and entertainment industry, creating a larger, more diversified platform that can leverage its combined content library and distribution network.
David Ellison, Chairman and CEO of Paramount, said the pursuit of Warner Bros. Discovery “has been guided by a clear purpose: to honor the legacy of two iconic companies while accelerating our vision of building a next‑generation media and entertainment company.” Netflix co‑CEOs Ted Sarandos and Greg Peters noted that the transaction “would have created shareholder value with a clear path to regulatory approval. However, we’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid.”
California’s Attorney General has opened an investigation into the merger, citing concerns about monopoly power and potential job losses. The regulatory review will be a key factor in determining whether the transaction can be completed in the projected timeframe.
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