Netflix has announced an agreement to acquire Warner Bros, including its film and TV studios, HBO and HBO Max. Valued at an enterprise value of nearly $82.7 billion, the deal marks one of the biggest transformations in Hollywood’s modern era. Here are ten essential facts you need to know about this blockbuster acquisition.
1. The Deal Values Warner Bros Discovery at $82.7 Billion
Netflix will acquire Warner Bros for a total enterprise value of approximately $82.7 billion and an equity value of $72 billion dollars. The transaction values each WBD share at $27.75, comprising both cash and Netflix stock.
2. WBD Shareholders Will Receive Cash and Netflix Stock
Each WBD shareholder will receive $23.25 in cash and $4.50 worth of Netflix stock per share. The stock component includes a collar mechanism to protect value during market fluctuations.
3. The Acquisition Follows a Competitive Bidding War
Netflix outbid Paramount Skydance and Comcast, offering nearly $28 per share. Paramount had offered $30 per share, but the Netflix proposal emerged as the winning bid after weeks of negotiations.
4. The Deal Reshapes Hollywood by Uniting Two Powerhouses
This acquisition combines Netflix’s global streaming leadership with Warner Bros’ century-old legacy, including franchises like Harry Potter, DC Universe, Game of Thrones, The Sopranos and Friends.
5. Netflix Gains Control of HBO and HBO Max
HBO and HBO Max, rivals in premium entertainment, will operate under the Netflix umbrella. Netflix says it will build on HBO’s creative heritage rather than replace it.
6. The Transaction Is Expected to Close After the Discovery Global Spinoff
WBD will first spin off its Global Networks unit into a new company called Discovery Global. This includes CNN, TNT Sports, Discovery channels and digital brands such as Bleacher Report. The spinoff is expected in Q3 2026, after which the acquisition will proceed.
7. Significant Cost Synergies Expected – Up to $3 Billion Annually
Netflix expects to achieve cost savings of $2 to $3 billion per year by the third year post-close. The deal is projected to be accretive to GAAP earnings per share by year two.
8. The Combined Studio Will Expand Production Capacity
Netflix plans to maintain Warner Bros’ current operations, including theatrical film releases. With expanded U.S. production capability, the combined entity aims to increase original content creation and support more creative jobs.
9. Regulators Are Expected to Scrutinize the Deal
Analysts expect intense antitrust review in the U.S. and Europe. Concerns include potential harm to competition, reduced choice for consumers and the implications of combining the world’s largest streamer with a major studio.
10. Netflix Strengthens Its Long-Term Strategy Across Streaming, Gaming and Global Growth
By controlling Warner Bros content, Netflix reduces reliance on outside studios and boosts its long-term content library. The deal strengthens Netflix’s gaming ambitions, with WBD’s hits like Hogwarts Legacy adding strategic value.
Baburajan Kizhakedath
