LOS ANGELES, Feb 27 (Reuters) - Netflix has pulled out of its bid to acquire Warner Bros. Discovery, saying the transaction is no longer financially compelling after a higher rival offer from Paramount Skydance shifted the balance of the takeover battle.
The move ends a high-profile pursuit that had raised the prospect of a new global powerhouse in the media and entertainment industry, combining Netflix’s streaming scale with Warner Bros.’ deep film and TV library.
In a statement on Thursday, Netflix co-CEOs Ted Sarandos and Greg Peters said the company had “decided to withdraw from the acquisition race” for Warner Bros., concluding the deal was “no longer financially attractive.”
“We believed we could be good stewards of Warner Bros.’ iconic brands,” they said. “But this deal was always something that would be good at the right price, not something that had to be done at any price.”
Netflix had agreed in December to acquire Warner Bros.’ streaming and studio businesses at $27.75 per share under a signed deal, according to people familiar with the matter.
That agreement came under pressure as Paramount Skydance, commonly referred to as Paramount, mounted an aggressive challenge. The company pursued Warner Bros. with litigation and hostile M&A tactics, and recently raised its bid to $31 per share, a level Warner Bros.’ board judged superior to Netflix’s existing terms.
The Warner Bros. board’s view that Paramount’s offer was more attractive effectively sidelined Netflix and narrowed its room to improve financial terms without stretching its own valuation and balance sheet.
Warner Bros. Discovery is one of Hollywood’s most storied studios, controlling franchises such as “Harry Potter” and “The Lord of the Rings,” assets long seen as highly valuable in the streaming era for their global fan bases and spin-off potential.
Netflix’s withdrawal underscores the increasingly competitive and expensive race for premium content libraries as traditional studios and streaming platforms vie for scale. With Paramount now in pole position, attention is expected to shift to whether it can close a deal with Warner Bros. and navigate likely regulatory and integration challenges in a consolidating media landscape.
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