Netflix backs out of bid for Warner Bros. Discovery, giving studios, HBO, and CNN to Ellison-owned Paramount
Published: (February 26, 2026 at 06:55 PM EST)
3 min read
Source: TechCrunch
Source: TechCrunch
Overview
The bidding war for Warner Bros. Discovery (WBD) has concluded with David Ellison’s Paramount acquiring the company. After Netflix declined to raise its $82.7 billion all‑cash offer, Paramount Skydance’s revised proposal of $31 per share—valuing WBD at about $111 billion—was deemed a “superior proposal” by the WBD board.
Timeline of Events
- Thursday – Warner Bros. Discovery announced that Paramount Skydance’s newest offer was a superior proposal, giving Netflix four business days to respond.
- Same day – Netflix issued a statement that it would not increase its bid and would walk away from the deal.
- Subsequent days – The board approved the Paramount offer, triggering the termination of Netflix’s agreement and the payment of a $2.8 billion termination fee.
Deal Terms
- Offer price: $31 per share, valuing WBD at roughly $111 billion.
- Termination fee: Warner Bros. Discovery must pay Netflix $2.8 billion to end the existing agreement.
- Debt assumption: Paramount will assume approximately $33 billion of WBD’s existing debt.
- Equity backing: Larry Ellison (net worth $201 billion per Bloomberg) will provide additional equity to fund the bid.
- Debt financing: A $57.5 billion debt commitment from Bank of America Merrill Lynch, Citi, and Apollo Global Management.
The acquisition includes all of WBD’s assets: studios, HBO, the streaming service, games and entertainment divisions, and linear television networks such as CNN, TBS, TNT, Discovery, and HGTV.
Financial Details
- Netflix’s original bid: $82.7 billion all‑cash offer for WBD’s studios and streaming service.
- Paramount’s prior bid: $108 billion for the full company, including linear TV networks.
- Current valuation: The $31‑per‑share offer values WBD at about $111 billion.
- Paramount market cap: Approximately $12 billion prior to the transaction.
Market Reaction
- Netflix shares: Jumped as much as 10 % in after‑hours trading in New York.
- Paramount shares: Rose about 4.5 % following the announcement.
Background on Ellison and Related Controversies
- Ownership: Paramount, now owned by Ellison’s Skydance Media, already controls major studios, entertainment, and news businesses.
- Potential job cuts: Ellison has warned that the acquisition could lead to significant reductions in staff.
- CBS connection: Ellison’s ownership of news network CBS has drawn criticism for perceived favorable coverage of the Trump administration; reporting critical of the administration has been shelved or faced increased scrutiny under CBS editor‑in‑chief Bari Weiss.
- Political ties: Larry Ellison is a major donor and supporter of former President Donald Trump.
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