Netflix is ​​withdrawing. Warner Bros. won’t buy it. Discovery

Just a few days ago it seemed that the case was almost closed. It was Netflix that was to buy Warner Bros Discovery and all its brands, including DC, Harry Potter, The Lord of the Rings, Looney Tunes and MonsterVerse (Godzilla and Kong). However, there was a twist worthy of many a movie. Netflix withdrew from the transaction.

Netflix announced that it is withdrawing from purchasing Warner Bros. Discovery. The earlier proposal was beneficial for the streaming service, as the company’s CEOs Ted Sarandos and Greg Peters argue in a statement. However, the other player in this race – Paramount Skydance – has upped the ante to a level that Netflix cannot afford.

The transaction we negotiated would be profitable for shareholders and provide a clear path to regulatory approval. However, we have always maintained discipline, and at the price required to match the latest Paramount Skydance offer, the deal is no longer financially attractive to us, so we are not matching the Paramount Skydance offer.

In short – Paramount Skydance beat Netflix’s offer. This one was considered more favorable by Netflix’s bosses. There’s no reason to be surprised. As much as USD 31 was proposed for each share (the previous proposal was USD 30). Plus an additional 25 cents for each quarter of late closing.

In addition, Paramount also agreed to pay Netflix $2.8 billion to cancel the previous agreement and $7 billion in compensation for Warner Bros. Discovery if the merger is blocked by regulators. For comparison, Netflix offered $27.75 per share, but without the television part of the business, which includes, among others, CNN, TNT, MTV and Poland’s TVN.

We are glad that the Management Board of WBD unanimously confirmed that our offer is extremely cost-effective, which translates into greater value for WBD shareholders, certainty and speed of finalizing the transaction.

The pressure from Donald Trump’s administration could also have been important. The US president is supported by Larry Ellison. The similarity of names with the head of Paramount is not accidental. Larry is David’s father.