Netflix to pay Warner Bros. all cash to thwart Paramount's hostile takeover bid

Netflix has signed a definitive agreement to acquire Warner Bros. Discovery's (WBD) film and television production and streaming businesses, but Paramount Sky is launching a hostile takeover . To counter the hostile takeover, Netflix has agreed to amend its acquisition price for WBD to $72 billion (approximately 11.4 trillion yen), paid all in cash.

Netflix and Warner Bros. Discovery Amend Agreement to All-Cash Transaction | Warner Bros. Discovery
https://www.wbd.com/news/netflix-and-warner-bros-discovery-amend-agreement-all-cash-transaction

Netflix to pay all cash for Warner Bros. to fend off Paramount hostile takeover - Ars Technica
https://arstechnica.com/tech-policy/2026/01/netflix-to-pay-all-cash-for-warner-bros-to-fend-off-paramount-hostile-takeover/

Under the amended agreement, Netflix will pay $27.75 (approximately JPY 4,400) per WBD share, unchanged from its previous offer. The original plan was for Netflix to pay $23.25 per share in cash combined with $4.50 (approximately JPY 700) in Netflix stock. This was changed to an all-cash payment to eliminate uncertainty due to market volatility and simplify the transaction. The reason for this change is that Netflix's stock price fell in early December 2025, and it is intended to solidify the value shareholders will receive.

Paramount Skydance has offered to buy WBD for $30 per share, a total of $108.4 billion, which is higher than Netflix's offer, but the WBD board has called Paramount's proposal 'merely unsubstantial' and has strong doubts about its feasibility.

Warner Bros. rejects Paramount's $17 trillion acquisition proposal, maintains agreement with Netflix, saying Paramount's proposal lacks the funds and substance to support its implementation - GIGAZINE

by Gage Skidmore

Paramount has a market capitalization of around $14 billion (approximately 2.22 trillion yen), a low credit rating, and a large amount of debt, while Netflix has a market capitalization of around $400 billion (approximately 63.3 trillion yen), an investment-grade credit rating, and is expected to generate more than $12 billion (approximately 1.9 trillion yen) in free cash flow by 2026.

The amended agreement will expedite the process leading up to WBD's shareholder vote. WBD has filed a Preliminary Proxy Voting Statement with the U.S. Securities and Exchange Commission (SEC) and plans to hold a shareholder vote by April 2026.

Paramount filed a lawsuit in Delaware Chancery Court alleging that WBD's board of directors withheld necessary information. The court denied Paramount's claim of 'irreparable harm' and dismissed its request to expedite the proceedings.

The Netflix transaction is expected to close within 12 to 18 months of the initial agreement, subject to the spin-off of Warner Bros.' cable channel division, Discovery Global, as well as regulatory approvals and shareholder approval.