Netflix Bows Out of Warner Bros. Discovery Bidding War

Netflix has withdrawn from the bidding war for Warner Bros. Discovery (WBD), opting not to match Paramount Skydance's improved offer, the company announced in a statement early Wednesday.

The streaming giant cited the elevated price tag as the reason, stating that matching Paramount's latest bid rendered the original deal with Warner Bros. no longer financially attractive. Netflix had proposed $27.75 per share in cash for WBD's studios and streaming business. Paramount raised its all-cash offer this week to $31 per share for 100% of the company, up from a previous $30 per share.

Warner Bros. notified Netflix that its board had deemed Paramount's proposal superior to the initial merger terms Netflix had negotiated. Netflix co-chief executives Ted Sarandos and Greg Peters said the transaction would have generated value for shareholders and cleared a straightforward path to regulatory approval. However, they added: "At the price required to match Paramount Skydance's latest offer, the agreement is no longer financially attractive, so we decline to match Paramount Skydance's offer."

The executives thanked WBD and its board for conducting a fair and rigorous process. They emphasised that Netflix would have been a strong steward of Warner Bros.' iconic brands, strengthening the entertainment industry and supporting US production jobs. "This transaction was always a desirable deal at the right price, not a must-do at any price," they noted.

Sarandos and Peters highlighted Netflix's robust business, which continues to grow organically through its content and streaming service. The company plans to invest around $20 billion this year in high-quality films and series while expanding its entertainment offerings. In line with its capital allocation strategy, Netflix will also resume its share buyback programme.