"After a prolonged will-they, won't-they phase between Paramount Skydance and Warner Bros. Discovery, Netflix swooped in with an $83 billion offer on Friday to acquire the Warner Bros. side of the business - which includes the film and TV studios, HBO Max and HBO. Variety reports that the $83 billion in enterprise value (meaning the entire worth of the business, including debt) levels out to about $72 billion in equity value, which is the amount that WBD shareholders actually pocket. The deal is slated to close in 12 to 18 months, after the planned spin-off of Discovery Global into its own company in Q3 next year."
"Of course, the deal is far from done yet, as several regulatory bodies still need to give their approval. Complicating this further in the US is President Donald Trump's close ties to Larry Ellison, the largest shareholder of Paramount Skydance and father of Paramount CEO David Ellison. Netflix CEO Reed Hastings is a prominent Democratic donor. In previous administrations, those wouldn't be such mitigating factors. But under President Trump and the current leadership of the DOJ, it would be unsurprising, and in fact was already reported by The New York Post, that Netflix would face a "sweeping, multiyear investigation" if its offer beat Paramount."
"David Ellison is already on the offensive as well, having penned an open letter to WBD CEO David Zaslav that called the process "tilted and unfair." In the short term, Netflix stated that it "expects to maintain Warner Bros.' current operations and build on its strengths, including theatrical releases for films.""
Netflix offered $83 billion in enterprise value, roughly $72 billion equity, to acquire Warner Bros.' film and TV studios plus HBO/HBO Max. The transaction is expected to close 12 to 18 months after Discovery Global's planned spin-off in Q3 of next year. Multiple regulatory approvals are required, and U.S. review could be complicated by President Trump's ties to Larry Ellison and Reed Hastings' political donations, raising the possibility of an extensive investigation. David Ellison publicly criticized the process as "tilted and unfair." Netflix intends to maintain Warner Bros.' current operations and theatrical releases, while longer-term restructuring could reshape entertainment and advertising markets.
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