Netflix has made an important change to its massive deal to buy Warner Bros. The streaming company is now offering only cash, instead of a mix of cash and Netflix shares. This update has shaken up an already intense battle over who gets to own one of the world’s most famous entertainment companies. The new deal puts extra pressure on a rival bid from Paramount, which has been arguing that its own offer is simpler, faster, and worth more money to shareholders.
Why did Netflix make the change?
Earlier, Netflix’s offer included cash plus $4.50 worth of its own stock. Now, Netflix says it will pay $27.75 per share entirely in cash for Warner Bros., removing stock from the equation.
With this change, the total deal is valued at about $83 billion. Netflix believes an all-cash offer will make things clearer and even quicker for shareholders and regulators. The company says this should help move the deal toward approval without long delays.
What happens to Discovery?
Under Netflix’s plan, Warner Bros. would be bought outright. However, Discovery Global would be separated and become its own independent company. This is where much of the debate lies. In a recent filing, Warner Bros. Discovery explained how much Discovery Global could be worth on its own.
Depending on the method used, its shares could be valued anywhere from as low as $1.33 to as high as $6.86. These wide-ranging numbers have become the center of disagreement between the companies involved.
Paramount says its offer is still better
Paramount, led by David Ellison, has pushed back hard. It is offering $30 per share in cash for the entire company and says this is clearly better for shareholders. Paramount also argues that Discovery Global should be worth very little, possibly even close to zero, based on comparisons with similar companies. Warner Bros. Discovery disagrees. Its board says Discovery’s improving performance and future deal potential justify a higher valuation than Paramount claims.
A legal fight and a shareholder vote ahead
Ellison has taken Warner Bros. Discovery to court, asking for more details about how Discovery Global was valued and how the company reached its conclusions. He has also threatened a proxy fight, where shareholders would be asked to vote against the Netflix deal. Warner Bros. Discovery has now confirmed that a special shareholder meeting will be held to decide the future of the deal. The date has not yet been announced, but the decision made there could shape the future of the entertainment industry.
In the agreement, David Zaslav, President and CEO of Warner Bros. Discovery, said the updated agreement brings the companies closer to a historic combination. He explained that joining with Netflix would help ensure Warner Bros.’ stories continue to reach audiences around the world for generations.
Ted Sarandos, co-CEO of Netflix, said the board strongly supports the deal and believes it offers the best outcome for shareholders, creators, and viewers. He added that the all-cash structure provides more certainty and speeds up the voting process.
Netflix co-CEO Greg Peters said the company’s long-term investment in film and television will only grow if the deal goes through. He stressed that Netflix sees the transaction as pro-consumer, pro-creator, and good for the future of the industry.
Samuel A. Di Piazza, Jr., chair of the Warner Bros. Discovery board, said the revised agreement shows the board’s focus on shareholder interests. He noted that the deal gives investors clear value now while also allowing them to benefit from Discovery Global’s future plans. As Netflix, Warner Bros. Discovery, and Paramount push forward, the fight is no longer just about price. It is about speed, certainty, and how much faith investors place in Discovery Global’s future.