Netflix Withdraws from Warner Bros Discovery Acquisition Following Paramount's Increased Offer
NEW YORK — Netflix has officially withdrawn from its planned acquisition of studio and streaming assets owned by Warner Bros Discovery (WBD) after the WBD board of directors announced on Thursday, 26 February 2026 local time that Paramount Skydance’s latest offer was superior.
Paramount had previously increased its offer to acquire the entire Warner Bros Discovery for $31 USD per share in cash, higher than Netflix’s proposal of $27.75 USD per share, which covered only the studio and streaming business.
This decision concluded a lengthy negotiation process between Netflix and Warner Bros Discovery that had been marked by revised offers from both parties over recent months.
Warner Bros Discovery CEO David Zaslav expressed appreciation to Netflix for the process undertaken. He added that the merger with Paramount is believed to deliver significant value to shareholders.
“After our board approved the merger agreement with Paramount, this will create great value for our shareholders. We are enthusiastic about the potential of combining Paramount Skydance and Warner Bros Discovery,” he stated.
Meanwhile, Netflix co-CEOs Ted Sarandos and Greg Peters emphasised that the withdrawal decision was made due to financial discipline considerations.
“The transaction we negotiated would create value for shareholders with a clear regulatory approval pathway. However, at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive,” they said.
Netflix concluded that acquiring Warner Bros Discovery was not an urgent necessity.
“This transaction from the outset was a ‘nice to have’ at the right price, not a ‘must have’ at any price,” they stated firmly.
In its latest proposal, Paramount Skydance also included a breakup fee of $7 billion USD should the merger fail to receive regulatory approval. Additionally, Paramount is willing to cover the $2.8 billion USD cancellation fee that WBD must pay to Netflix if their agreement is terminated.
Following the announcement, Netflix shares surged 10 per cent in after-hours trading. Paramount shares rose 5 per cent, whilst Warner Bros Discovery shares fell 2 per cent.
Netflix’s decision to withdraw has cleared the path for Paramount Skydance to proceed with the full merger with Warner Bros Discovery, including the takeover of television networks such as CNN, TBS, and TNT.