Paramount Skydance has won the bidding war for Warner Bros. Discovery, with Netflix announcing its withdrawal from the bidding, signaling a new wave of consolidation in Hollywood.
On Thursday, February 26, Netflix co-CEOs Ted Sarandos and Greg Peters issued a statement indicating that the company would not pursue a counteroffer after the Warner board determined that Paramount's all-cash offer of $31 per share was superior to Netflix's proposal.
Ted Sarandos and Greg Peters stated in the announcement:
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To match Paramount's latest bid, this deal is no longer financially attractive. This transaction has always been 'a nice-to-have if the price is right' for us, rather than 'we must acquire at any cost.'
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Since market rumors emerged last September that Netflix might bid for Warner, Netflix's stock price has been under pressure, with a market value evaporating by over $170 billion. Following the announcement of its withdrawal, the stock surged by 10% in after-hours trading, as the market interpreted this as Netflix avoiding a large-scale consolidation deal at an excessively high premium.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/8a9ec5b5-67d9-450d-ae84-7a1c2aacc71b.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/8a9ec5b5-67d9-450d-ae84-7a1c2aacc71b.png"/>
Warner CEO David Zaslav stated that once the board votes to approve the merger agreement with Paramount, &#34;it will create tremendous value for shareholders.&#34;
If the transaction receives regulatory approval, Paramount will integrate Warner Bros. Discovery for approximately $81 billion, owning top IP assets such as HBO, CNN, CBS News, Warner Bros. Pictures, and franchises like Harry Potter and Superman, becoming an entertainment giant capable of competing with Disney.
<h2>Paramount's Turnaround: From Repeated Rejections to Final Victory</h2>
For Paramount, this acquisition represents a significant turnaround.
Over the past year, Paramount's multiple proactive bids were rejected by Warner, which subsequently initiated a formal sale process. In December of last year, Netflix signed an agreement with a proposal of $27.75 per share, totaling $72 billion, becoming the leading buyer.
Paramount then launched a hostile takeover, bypassing management to directly propose an all-cash offer of $30 per share to shareholders, including Warner's cable networks, which were precisely the assets Netflix was not interested in.
Earlier this week, Paramount raised its offer to $31 per share and made concessions on key terms.
Paramount increased the termination fee it would have to pay if the deal fails due to regulatory reasons to $7 billion; committed to paying Warner's $2.8 billion breakup fee to Netflix; and advanced the start date for the quarterly &#34;timing fee&#34; of $0.25 per share from January next year to after September 30 of this year.
Last August, Ellison's Skydance Media acquired Paramount Pictures, making the acquisition of Warner Bros. a top priority. Paramount had previously been considered too small to compete with financially robust giants like Disney, Netflix, and Amazon
<h2>Regulatory Review: CNN Ownership Raises Concerns About Media Concentration</h2>
Although Paramount ultimately prevailed, the deal still requires strict scrutiny from federal regulators.
Paramount's streaming business is much smaller than Netflix, but this merger will bring two traditional film and television studios under one roof, covering multiple cable channels such as CNN, TNT, TBS, and Food Network.
From a media regulatory perspective, the ownership issue of CNN is particularly sensitive. After the deal is completed, Ellison will simultaneously control CBS News and CNN. Craig Aaron, co-CEO of the media advocacy organization Free Press, stated:
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The idea of allowing Paramount to control CBS and CNN is unimaginable.
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Craig Aaron added that the new owner promised President Trump that if given the opportunity, they would &#34;thoroughly reform CNN, and we know what that means.&#34;
CNN President Mark Thompson urged employees in an internal memo to &#34;not rush to conclusions before learning more information.&#34;

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Paramount Sky Dance Company defeated Netflix with a comprehensive acquisition offer of $31 per share, approximately $81 billion, winning the bidding war for Warner Bros. Discovery. Netflix announced its withdrawal on the grounds of "financial unfeasibility," and its stock surged 10% in after-hours trading. The merger still requires regulatory review, and if approved, Paramount will integrate top assets such as HBO, CNN, and CBS

- Paramount Skydance has won the bidding war for Warner Bros. Discovery, with Netflix announcing its withdrawal after Warner's board deemed Paramount's $31 per share offer superior.  
- The deal, if approved, would merge Paramount with Warner Bros. for about $81 billion, creating a media giant that could compete with Disney, while also facing regulatory scrutiny over ownership concerns regarding CNN and CBS News.  
- Despite Paramount's success, the transaction's regulatory approval is uncertain, raising alarms over media concentration, particularly as Ellison’s control of both CBS and CNN has drawn criticism.

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Paramount raises prices, Netflix "does not follow," Warner Bros. acquisition case "settled"