Netflix is reportedly in exclusive negotiations to acquire Warner Bros. Discovery's film and TV studio and its streaming service HBO Max, a deal that could significantly reshape the media and entertainment industry. The discussions, if successful, could be announced in the coming days, according to sources cited by Bloomberg News on December 5th.
Warner Bros., which emerged from the 2022 merger of WarnerMedia and Discovery, plans to finalize the corporate separation of its cable broadcasting division before completing the sale. The company, valued at over $60 billion, owns not only the iconic Warner Bros. studio and HBO Max but also cable channels like CNN and Discovery.
The acquisition battle has seen major players such as Netflix, Paramount, and Comcast vying for Warner Bros., with Netflix reportedly offering the highest bid. According to reports, Netflix's offer consists predominantly of cash transactions, with a proposal to pay 85% of the acquisition price in cash.
The merger, if completed, would unite Netflix, the world's leading streaming service, with Warner Bros., a historic Hollywood studio, potentially leading to a major industry transformation. However, the acquisition is likely to face scrutiny over antitrust concerns, with Netflix proposing a $5 billion breakup fee if regulatory approvals are not obtained.
Paramount, which had expressed interest in acquiring Warner Bros. in its entirety, has protested the fairness of the bidding process, accusing Warner Bros. of favoring Netflix. Paramount's legal representatives have criticized Warner Bros. for allegedly breaching its duties to shareholders by conducting a biased transaction process.
In response, Warner Bros. has stated that the board is handling the acquisition process with utmost diligence and has shared Paramount's concerns with its board of directors, assuring that it will continue to fulfill its obligations responsibly.
The outcome of these negotiations could signal a new era in the entertainment sector, potentially altering the competitive landscape and setting new precedents in media mergers.
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