Netflix will now finance the entirety of its $72 billion offer for Warner Bros. Discovery’s streaming and studio assets in cash, the companies announced Tuesday.
The all-cash deal will replace Netflix’s initial cash-and-stock offer, but keeps the total equity value of the streaming giant’s bid unchanged at $27.75 per Warner Bros. share. The cash transaction terms were unanimously approved by the boards of directors of both Netflix and Warner Bros., the companies said Tuesday.
“Our revised all-cash agreement will enable an expedited timeline to a stockholder vote and provide greater financial certainty at $27.75 per share in cash, plus the value from the planned separation of Discovery Global,” Ted Sarandos, co-CEO of Netflix, said in a statement Tuesday.
The new deal terms come as Netflix’s rival bidder, Paramount Skydance, continues to ratchet up pressure on Warner Bros. shareholders to accept its own all-cash offer for total ownership of the company. The Warner Bros. board has repeatedly urged shareholders to reject Paramount’s hostile bid, citing significant risk for stockholders and concern over the financial backing of the deal.
Despite those staunch rejections, Paramount is refusing to back down. The company sued Warner Bros. on Jan. 12 in an attempt to force a release of information about the Warner Bros. merger agreement with Netflix. Shortly after, Paramount said it plans to launch a proxy fight for seats on the Warner Bros. board, which is expected to come to a head at the company’s annual stockholder meeting. That typically occurs in the spring.
A Delaware judge rejected Paramount’s attempt to expedite the lawsuit, saying the company failed to prove it would suffer “irreparable harm” by Warner Bros. allegedly omitting information about its deal with Netflix.
Under Netflix’s revised deal terms, Warner Bros. stockholders could vote to approve Netflix’s proposed purchase as soon as April. Warner Bros. on Tuesday filed a preliminary proxy statement seeking approval for the proposed deal with Netflix.
Warner Bros. praised the all-cash agreement Tuesday, saying it cements the value shareholders will receive since they will be able to retain shares in Discovery Global, the company that will house Warner Bros. cable assets, which Netflix does not plan to buy.
Warner Bros, is planning to separate its film and streaming assets and its cable assets, which include CNN, TNT and the Food Network, into two separate publicly traded companies.
The separation of Discovery Global is expected to be complete before the Netlfix and Warner Bros. merger, according to the Warner Bros. board.
By noon Tuesday, Netflix (NFLX) stock was trading at $88.65 per share, maintaining its previous closing price of $88.00 per share. Warner Bros. (WBD) stock was trading at $28.75, maintaing its previous closing price of $28.57.
Sydney Carruth is a breaking news reporter covering national politics and policy for MS NOW. You can send her tips from a non-work device on Signal at SydneyCarruth.46 or follow her work on X and Bluesky.