Paramount Skydance emerged Thursday as the winning bidder for Warner Bros. Discovery after Netflix co-CEOs Ted Sarandos and Greg Peters declined to raise their company’s offer to match Paramount’s revised all-cash proposal, a stunning reversal that came hours after Sarandos had been at the White House lobbying Trump administration officials on Netflix’s behalf, and ended a months-long bidding war that reshaped the landscape of global entertainment.
The Warner Bros. Discovery board formally declared Paramount Skydance’s revised offer a “superior proposal” under the terms of its existing merger agreement with Netflix. Paramount’s bid values the entirety of Warner Bros. Discovery at approximately $111 billion, or $31 per share in cash, up from the company’s previous $30-per-share proposal and significantly above the $27.75 per share Netflix had offered for a partial acquisition of the company’s streaming service, film studio, and HBO assets.
Netflix shares surged as much as 15 percent in after-hours trading following the announcement, reflecting investor relief that the streaming giant would not stretch further to compete for an asset many on Wall Street had regarded as financially marginal at the required price. Paramount stock gained approximately 5 percent. Warner Bros. Discovery shares fell 2 percent.
Netflix had until March 4 under the terms of its existing merger agreement to submit a matching or superior offer before the Warner board could formally terminate its deal with the streaming company. It chose not to wait.
“The transaction we negotiated would have created shareholder value with a clear path to regulatory approval,” Sarandos and Peters said in a joint statement. “However, we’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid.”
The speed of Netflix’s withdrawal surprised even seasoned Hollywood observers. The fact that Sarandos had spent part of Thursday inside the White House, meeting Trump administration officials in what was understood to be an effort to build regulatory support for the Netflix-Warner deal, made the afternoon announcement that Netflix was walking away one of the more jarring sequences in a saga already defined by dramatic reversals. President Trump was not among those who met with the Netflix chief executive, a White House official said.
Warner Bros. Discovery Chief Executive David Zaslav was generous in tone toward his now-departing partner while signalling a swift pivot.
“Netflix is a great company and throughout this process Ted, Greg, Spence and everyone there have been extraordinary partners to us,” Mr. Zaslav said, referring to Sarandos, Peters, and Netflix Chief Financial Officer Spencer Neumann. “Once our board votes to adopt the Paramount merger agreement, it will create tremendous value for our shareholders. We are excited about the potential of a combined Paramount Skydance and Warner Bros. Discovery and can’t wait to get started working together telling the stories that move the world.”
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Warner Bros. Discovery board chair Samuel A. Di Piazza Jr. described the outcome as the product of a rigorous five-and-a-half month competitive process.
“I am extremely proud of the rigorous process this board has run that has led us to the cusp of combining these two storied companies and the excitement it will bring to audiences for many years to come,” he said.
The deal, if it clears remaining hurdles, would assemble an entity of considerable scale and complexity. A combined Paramount Skydance and Warner Bros. Discovery would bring together two of Hollywood’s largest production studios alongside two streaming platforms, Paramount+ and HBO Max,Β and two major news operations in CNN and CBS News. Under the Netflix agreement, CNN and other cable channels would have been spun off as a separate entity called Discovery Global, leaving Netflix with only Warner’s premium assets. Paramount’s all-cash offer for the entire company preserves the combined entity intact.
The deal is not yet final. The Warner Bros. Discovery board must first formally vote to terminate its agreement with Netflix, a step that could occur as early as Friday. A Warner Bros. Discovery shareholder vote is then scheduled for March 20. The transaction must also clear regulatory scrutiny at the federal and state level, a process whose outcome is far from assured.
Paramount’s financial commitments have been significantly expanded to accommodate the higher bid. The Ellison Trust, controlled by David Ellison, son of Oracle co-founder and Trump ally Larry Ellison, is committing $45.7 billion in equity, up from $43.6 billion, with Larry Ellison also agreeing to provide additional capital to meet bank solvency requirements. Bank of America Merrill Lynch, Citigroup, and Apollo are providing $57.5 billion in debt financing, increased from a prior $54 billion commitment. Paramount has also raised the reverse termination fee it would pay if regulators block the transaction to $7 billion from $5.8 billion, and agreed to absorb the $2.8 billion breakup fee Warner Bros. Discovery would otherwise owe Netflix for terminating their agreement.
The Ellison family’s close relationship with President Trump has introduced political complexity into the regulatory calculus. Trump told NBC News earlier this month that he planned to stay out of the bidding contest. Democratic senators including Elizabeth Warren, Bernie Sanders, and Richard Blumenthal have publicly questioned whether the deal’s regulatory treatment could be coloured by those political ties. California Attorney General Rob Bonta, a Democrat, said late Thursday that the transaction had not cleared scrutiny. “These two Hollywood titans have not cleared regulatory scrutiny, the California Department of Justice has an open investigation, and we intend to be vigorous in our review,” Mr. Bonta said. TD Cowen analysts said in a research note that federal approval appeared likely given the current political environment, but that California and European regulators posed meaningful challenges.
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Activist investor Ancora Holdings, which holds a minority stake in Warner Bros. Discovery and had publicly pressed the company’s board to engage more seriously with Paramount’s overtures, welcomed the outcome.
“Netflix’s decision to not raise its offer has paved the way for shareholders to receive meaningfully more cash and a truly viable path to government approvals,” the firm said in a statement. “This is a win-win for shareholders and the industry.”
The shareholder vote is scheduled for March 20, 2026. Regulatory filings and detailed merger agreement terms are expected to be released publicly in the coming days, ahead of that vote.
