Netflix withdraws from Warner Bros. Discovery bid, clearing path for Ellison-backed Paramount deal

After a wave of offers valued in the high tens of billions of dollars, the takeover battle for Warner Bros. Discovery has concluded. Paramount, controlled by David Ellison, will acquire Warner Bros. Discovery.

On Thursday, Warner Bros. Discovery said that Paramount Skydance’s newest proposal of $31 per share was a “superior proposal,” triggering a four-business-day window for Netflix to respond with a higher offer. Netflix then said it would not increase its $82.7 billion all-cash bid for the legacy studio and would step away from the process.

“The transaction we negotiated would have created shareholder value with a clear path to regulatory approval,” Netflix co-CEOs Ted Sarandos and Greg Peters said in a statement Thursday. “However, we’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid.”

Under the terms of the existing agreement, Warner Bros. Discovery will be required to pay Netflix a $2.8 billion termination fee to end the original deal. Paramount’s refreshed offer—backed by Oracle executive chair Larry Ellison, David Ellison’s father, who is described as the world’s sixth-richest person—includes covering that breakup fee.

The transaction will result in Paramount, which Ellison’s Skydance Media purchased last year with major financial backing from his father, acquiring the full Warner Bros. Discovery portfolio. That includes its studios, HBO, its streaming service, its games and entertainment operations, and linear TV networks such as CNN, TBS, TNT, Discovery, and HGTV.

Ellison, whose Paramount already holds major studio, entertainment, and news assets, has warned that substantial job cuts may follow. His ownership of the news outlet CBS has also drawn controversy and is widely seen as a sympathetic shift toward the Trump administration, with reporting critical of the administration reportedly shelved or subjected to heavier scrutiny by Ellison and CBS’s editor-in-chief, the conservative provocateur Bari Weiss. Larry Ellison is a major donor and supporter of President Trump.

Netflix first announced its intention to buy WBD in December, offering close to $83 billion, with a focus on the company’s studios and streaming business. Even after multiple hostile bids from Paramount, Warner Bros. Discovery repeatedly told shareholders it considered Netflix’s proposal stronger than Paramount’s earlier offer, which put $108 billion on the table for the entire company, including its linear television networks. Paramount’s latest $31-per-share bid values WBD at roughly $111 billion.

As part of the agreement, Paramount will assume about $33 billion in debt carried by Warner Bros. Discovery. Larry Ellison—whose net worth Bloomberg lists at $201 billion—has agreed to provide additional equity needed to complete Paramount’s bid. Paramount’s market capitalisation is about $12 billion.

Financing for the deal also includes a $57.5 billion debt commitment from Bank of America Merrill Lynch, Citi, and Apollo Global Management. In after-hours trading in New York, Netflix shares jumped as much as 10%. Paramount shares rose about 4.5%.