Paramount Skydance Corporation has finalized a definitive agreement to acquire Warner Bros. Discovery (WBD) in a monumental deal valued at approximately $110 billion, including debt. This major acquisition follows a competitive bidding war, with streaming giant Netflix ultimately withdrawing its offer. The agreement, announced on February 27, 2026, will create a new powerhouse in the global media and entertainment landscape.[theguardian+9]
Bidding War Concludes
The battle for Warner Bros. Discovery intensified over recent months, pitting Paramount Skydance against Netflix. Netflix had initially agreed in December to purchase WBD's studio and streaming assets for $82.7 billion, equating to $27.75 per share.However, Paramount Skydance, the entity formed by the merger of Skydance Media and Paramount Global in August 2025, launched a rival all-cash bid.[cbsnews+7]
Paramount Skydance initially offered $30 per share for the entire company. On Tuesday, February 25, 2026, it raised its all-cash offer for Warner Bros. Discovery to $31 per share, valuing the deal at roughly $110 billion.Warner Bros. Discovery's board of directors then determined that Paramount Skydance's revised proposal constituted a "superior offer" compared to Netflix's existing agreement.[cbsnews+16]
Netflix was given a four-business-day window to counter Paramount Skydance's increased bid.However, the company announced on Thursday, February 26, 2026, that it would not raise its offer.Netflix co-CEOs Ted Sarandos and Greg Peters stated that at the price required to match Paramount Skydance's latest offer, the deal was "no longer financially attractive."[theguardian+13]
Netflix Shares Jump
Following Netflix's decision to walk away from the high-stakes acquisition, its shares saw a significant boost. Netflix stock jumped 10.2% in after-hours trading.This positive market reaction indicates investors cheered the company's financial discipline and unwillingness to overspend on the acquisition.Sarandos and Peters emphasized that the Warner Bros. acquisition was "a nice to have at the right price, not a must have at any price."Netflix plans to invest approximately $20 billion in films and series this year and will resume its share repurchase program.[heygotrade+4]
David Ellison, chairman and CEO of Paramount Skydance, expressed enthusiasm for the merger. "By bringing together these world-class studios, our complementary streaming platforms, and the extraordinary talent behind them, we will create even greater value for audiences, partners and shareholders," Ellison said.David Zaslav, President and CEO of Warner Bros. Discovery, noted the company pushed to "secure a transaction that maximizes the value of our iconic assets."[cbsnews+2]
Creating a Media Behemoth
The newly combined company, which will operate under the Paramount Skydance Corporation umbrella, will bring together an extensive portfolio of media assets. This includes major brands such as CNN, CBS, HBO, Nickelodeon, and film franchises like Harry Potter, Game of Thrones, the DC Universe, Mission Impossible, and SpongeBob SquarePants.The merger aims to establish a premier direct-to-consumer platform, enhancing reach and engagement in the competitive streaming market.[nzherald+2]
Paramount Skydance expects the acquisition to generate over $6 billion in synergies. These savings are anticipated from technology integration, corporate-wide efficiencies, and optimizing real estate.The combined entity also committed to producing a minimum of 30 theatrical films annually, ensuring a robust pipeline of content for both its own platforms and third-party distribution.[paramount+3]
Regulatory Hurdles and Concerns
Despite the definitive agreement, the merger still faces significant regulatory scrutiny. The deal requires approval from authorities in both the United States and Europe.California's Attorney General, Rob Bonta, has already stated that his office has an open investigation into the potential merger.Bonta emphasized that the deal is "not a done deal" and vowed a "vigorous review."[theguardian+5]
Concerns have also been raised regarding the potential impact on jobs and competition within the media industry. The Writers Guild of America, representing thousands of television and film writers, voiced fears that a Paramount takeover of Warner Bros. could lead to job cuts.The union cited past instances, such as Warner Bros. canceling $2 billion in content after its merger with Discovery in 2022, and layoffs following Paramount's recent merger with Skydance.[theguardian+1]
The acquisition also carries political implications. Larry Ellison, David Ellison's father and a key financier of the deal, is a long-time ally of former President Donald Trump.White House officials reportedly preferred Paramount's bid, given the Ellison family's friendly relationship with the president.US Senator Elizabeth Warren called the potential merger "an antitrust disaster threatening higher prices and fewer choices for American families."[nzherald+2]
The transaction has been unanimously approved by the boards of directors of both Paramount Skydance and Warner Bros. Discovery.It is expected to close in the third quarter of 2026, pending the necessary regulatory clearances and approval from WBD shareholders.In the event of delays, WBD shareholders will receive a "ticking fee" of $0.25 per share for each quarter the transaction extends beyond September 30, 2026.[paramount+6]
