Netflix, Inc. (NFLX) entered a merger agreement on December 5, 2025, to acquire Warner Bros. Discovery, Inc. (WBD) in a deal valued at $82.7 billion.
Each Warner Bros. Discovery shareholder will receive $23.25 in cash and $4.5 in shares of Netflix common stock for each share of Warner Bros. Discovery common stock. The transaction values Warner Bros. Discovery at $27.75 per share, representing a premium of 13.08% from the stock’s last close.
The stock component is subject to a collar under which Warner Bros. Discovery shareholders will receive Netflix stock valued at $4.5 per share, provided the 15-day volume weighted average price (VWAP) of Netflix stock falls between $97.91 and $119.67.
If the VWAP is below $97.91, Warner Bros. Discovery shareholders will receive 0.046 Netflix shares, and if it is above $119.67, the shareholders will receive 0.0376 Netflix shares for each Warner Bros. Discovery share.
Warner Bros. Discovery is a global media and entertainment company that produces and distributes films, TV shows, and streaming content across its Studios, Networks, and direct-to-consumer platforms. It owns a wide range of iconic brands and franchises, including Warner Bros., HBO, DC, Discovery, CNN, and more.
Netflix is a global entertainment company that streams TV shows, films, documentaries, and mobile games to subscribers across internet-connected devices. It serves over 222 million members in over 190 countries.
Since September, Warner Bros. Discovery became the focus of intense takeover interest from multiple major players in the media industry. Paramount Skydance (PSKY) repeatedly pursued a full-company acquisition, while Comcast (CMCSA) and Netflix explored bids primarily for the studio and streaming assets. In the last week, bidding tensions escalated as Netflix entered exclusive talks, prompting objections from Paramount and broader concern across Hollywood. The stock was trading at $12.54 when the talks first started in September.
In this deal, Netflix will acquire Warner Bros., including its film and television studios, HBO Max, and HBO.
The deal is expected to close following the separation of Warner Bros. Discovery’s Global Networks division, Discovery Global, into a new publicly traded company, a process now anticipated to be completed in Q3 2026.
The newly separated publicly traded company, Discovery Global, will house WBD’s Global Networks division and include leading entertainment, sports, and news brands worldwide, such as CNN, TNT Sports in the U.S., Discovery, various free-to-air channels across Europe, and digital platforms like Discovery+ and Bleacher Report.
This acquisition brings together two major entertainment companies by combining Netflix’s global streaming strength with Warner Bros.’ long history of producing iconic films and shows. Popular titles like The Big Bang Theory, Harry Potter, Game of Thrones, The Wizard of Oz, and the DC Universe would join Netflix hits like Wednesday, Money Heist, Bridgerton, Adolescence, and KPop Demon Hunters.
Netflix plans to keep Warner Bros.’ existing operations in place and continue supporting its strengths, including releasing films in theaters.
The company also expects to save at least $2–3 billion a year by the third year and believes the deal will start increasing its GAAP earnings per share by the second year.
The merger is expected to close in 12-18 months.
Moelis & Co. is serving as Netflix’s financial advisor, and the law firm Skadden, Arps, Slate, Meagher & Flom is providing legal support. Wells Fargo is also advising Netflix financially and, together with BNP and HSBC, is supplying the committed debt financing for the deal.
Allen & Co., J.P. Morgan, and Evercore are advising Warner Bros. Discovery, while the law firms Wachtell Lipton, Rosen & Katz and Debevoise & Plimpton are handling its legal matters.
Netflix’s acquisition values Warner Bros. Discovery at 11.77 times its EBITDA.
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Deal Metrics for the acquisition of Warner Bros. Discovery, Inc. (WBD) by Netflix, Inc. (NFLX)
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Editor’s Note: Baranjot Kaur contributed to this article