Streaming giant Netflix has officially withdrawn from the race to acquire Warner Bros. Discovery, paving the way for Paramount Skydance to take the lead in what could become one of the largest media mergers in recent years.
Netflix had earlier submitted an offer of $27.75 per share targeting Warner’s studio operations and HBO Max streaming platform, valuing the assets at approximately $83 billion, including debt.
However, Paramount Skydance later presented a higher final bid of $31 per share for the entire Warner Bros. Discovery group, placing the company’s valuation at about $111 billion, debt inclusive.
Although Warner’s board initially backed Netflix’s proposal, it acknowledged that Paramount’s revised offer now constituted a “superior” deal signalling growing support for the rival bidder.
Following that assessment, Netflix confirmed it would not revise its offer, stating that the acquisition was no longer financially viable.
Co-chief executives Ted Sarandos and Greg Peters noted in a joint statement that the potential deal was never essential to the company’s long-term strategy.
Despite Netflix’s exit, the takeover process remains incomplete, as Warner Bros. Discovery’s board has yet to grant formal approval to Paramount’s proposal. CEO David Zaslav described the offer as one capable of generating significant shareholder value.
Any eventual agreement will still require regulatory clearance and shareholder consent, with competition concerns expected to attract close scrutiny from U.S. authorities.
If finalized, the merger would consolidate major global media assets including CNN and CBS News under a single corporate structure, intensifying ongoing debates over consolidation within the American media industry.
Paramount Skydance is led by David Ellison, son of technology billionaire Larry Ellison, who is backing financing for the acquisition.
Market reactions were swift following the announcement. Netflix shares rose by 8.5 percent in after-hours trading, reflecting investor approval of the company’s decision to avoid an expensive acquisition.
Paramount shares gained 6.2 percent, while Warner Bros. Discovery stock slipped nearly 2 percent to $28.80 below Paramount’s offer price.
Industry analysts interpreted Netflix’s withdrawal as a sign of financial discipline, allowing the company to maintain focus on profitability, pricing strategy and operational performance.
Should Paramount Skydance succeed, the combined entity would unite iconic entertainment franchises such as Harry Potter, Superman, and Barbie with Paramount’s celebrated portfolio, including Top Gun and The Godfather, alongside the Paramount streaming platform.
While the bidding contest appears largely settled, regulatory approvals and shareholder negotiations remain key hurdles before the landmark media merger can be completed.
