A powerful shift in global media
Netflix agrees to acquire the film and streaming divisions of Warner Bros Discovery for 72 billion dollars. The streaming leader wins a long bidding contest against Comcast and Paramount Skydance. Warner Bros controls major franchises like Harry Potter and Game of Thrones and operates the streaming platform HBO Max. The takeover forms a major new force in global media, but regulators must still approve the deal. Industry groups, including the Writers Guild of America, criticise the plan and warn of risks for workers and audiences.
Ted Sarandos, co-chief executive of Netflix, says the company feels highly confident about regulatory approval. He says the combined catalogues will give viewers more stories they already enjoy. He argues that Warner Bros shaped entertainment for a century and both firms can now shape the next century together.
Greg Peters, the other co-chief executive, says the HBO brand stays essential for audiences. He adds that it is too early to present details on how the merged service will look.
Savings strategy and production plans
Netflix expects two to three billion dollars in savings. Most savings will come from removing overlap in support and technology teams. Warner Bros will keep releasing films in cinemas. The Warner Bros television studio can still produce shows for outside distributors. Netflix will continue creating exclusive content for its own platform.
Sarandos calls the deal a major moment for both companies. He admits that the move surprised some investors. He still believes the merger gives Netflix a rare chance to secure long-term success. David Zaslav, chief executive of Warner Bros, says the agreement unites two major storytelling companies. He says the partnership will help future generations enjoy strong and influential stories.
The cash and stock offer values each Warner Bros share at 27.75 dollars. The enterprise value reaches about 82.7 billion dollars. The pure equity value stands at 72 billion dollars. Boards on both sides approve the agreement unanimously.
Rising concern across the industry
The Writers Guild of America calls on regulators to block the merger. It warns of job cuts, wage pressure and weaker working conditions. It says viewers may face higher prices and fewer diverse shows. Michael O’Leary, chief of Cinema United, calls the takeover a threat to cinemas worldwide. He fears major damage for large chains and small independent theatres.
Netflix will complete the deal once Warner Bros finishes its plan to split its business into two companies. The global networks unit will operate as Discovery Global. It will include major US news and sports channels and several European free-to-air networks. TNT Sports International will remain with the division sold to Netflix.
Hollywood prepares for deep transformation
Analyst Paolo Pescatore says the sale sends a clear message about Netflix’s global ambitions. He warns that integrating such a large organisation may create major challenges. Paramount previously attempted to buy all of Warner Bros, but the company rejected the offer before putting itself up for sale.
Tom Harrington of Enders Analysis says the takeover would reshape Hollywood if approved. He expects significant cuts in film and television output from a merged firm. He predicts resistance from unions and key industry groups. He also warns that viewers would likely face higher subscription prices.
Danni Hewson of AJ Bell says Netflix offers reassurance by confirming that Warner Bros films will stay in cinemas. She says quick regulatory approval could unlock major cost savings. She warns that regulators will examine whether Netflix gains too much pricing influence in the market.
