The streaming acquisition battle for Warner Bros.: Paramount raises its bid again, Netflix decisively backs out, creating the biggest merger in history

Advances in technology have changed modern life in countless ways, including how we watch movies and TV. Traditional TV viewership has gradually been replaced by short-form video and YouTube, alongside the massive streaming market. A few days ago, Netflix announced its acquisition of Warner Bros. with great fanfare. Warner Bros. film and television studios, HBO Max, and HBO would all become Netflix assets. The news had movie fans talking, until an unexpected contender entered the picture: Paramount Pictures.

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AT&T’s acquisition of Warner Bros. had already left the company with a heavy debt burden. WarnerMedia later merged with Discovery, Inc. to form Warner Bros. Discovery (WBD), which has spent the past two years trying to reduce its US$ 43 billion debt, with limited success. Its streaming division, the most profitable part of the business, also needs more investment, making the sale of its “Studios & Streaming” division WBD’s best option right now.

Netflix and WBD reached an agreement for Netflix to acquire WBD at US$ 27.75 per share, including US$ 23.25 in cash and US$ 4.50 worth of Netflix stock. The transaction was valued at US$ 82.7 billion, with WBD’s equity valued at US$ 72 billion. Just three days later, Paramount Pictures came forward with better terms: US$ 30.00 per share, paid entirely in cash, around US$ 18 billion more than Netflix’s offer.

Who will WBD ultimately belong to? Netflix and Warner Bros. had already reached an agreement, though the deal faced antitrust risks. Paramount’s offer was better, and it could also support a more competitive market. Choosing Netflix would mean Warner Bros. would have to pay a breakup fee while facing the possibility of regulatory rejection; choosing Paramount, on the other hand, would leave Paramount with an even larger debt burden… Yet the outcome of this streaming war has quietly emerged.

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Netflix first revised its acquisition strategy, offering to pay entirely in cash while keeping the price at US$ 27.75 per share. Under these circumstances, Paramount Pictures also updated its final offer. It bid US$ 31 per share, still entirely in cash. After receiving notice from WBD, Netflix took only two hours to decide to withdraw from the bidding war, meaning the HBO Max and Paramount+ streaming platforms are set to merge.

At US$ 111 billion, Paramount Pictures’ acquisition marks the largest deal in media industry history. Beyond the acquisition cost, Paramount must also pay Netflix a US$ 2.8 billion termination fee. After Netflix withdrew from the bidding, its stock price rose, with the market viewing the move as a smart decision.

Paramount Pictures expects to complete the acquisition by the end of September 2026. It will then own a library of rights to more than 15,000 films and titles, including “Game of Thrones,” “Harry Potter,” the DC Universe, “The Matrix,” “Friends,” “Mission: Impossible,” “Star Trek,” “Transformers,” and “SpongeBob SquarePants.” They may be presented through a “Paramount” channel on HBO Max.

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