The agreement with Netflix permits Warner Bros. to evaluate superior offers, notwithstanding the existing pact with the streaming giant. Paramount had previously indicated its willingness to compensate Netflix for termination.
Sources familiar with the matter informed The New York Times (NYT) that Warner Bros. Discovery is contemplating re-entering negotiations with Paramount, which last week presented a revised, enhanced proposal.
Warner Bros. Discovery’s board of directors is currently assessing whether Paramount’s offer presents a more financially advantageous arrangement.
Last week, on February 10th, Paramount incorporated a new stipulation into its bid: a “waiting fee” of 25 cents per share, payable quarterly to Warner Bros. shareholders beginning January 2027, should the Netflix deal not be finalized by then. Paramount would assume the responsibility for the $2.8 billion penalty Warner Bros. Discovery owes Netflix as compensation for the collapse of their $82.7 billion transaction. Paramount maintained its overall valuation for acquiring the entirety of Warner Bros. Discovery at $30 per share, totaling $108.4 billion.
In January 2025, Warner Bros. Discovery had agreed to Netflix’s terms. This involved the streamer reducing Warner’s debt holdings with Discovery Global—a firm set to manage cable channels such as CNN, TNT, and Food Network—by $260 million, while also agreeing to acquire shares for $82.7 billion. Warner Bros. shareholders were slated to receive $23.25 billion in cash plus $4.5 billion in Netflix common stock, subject to certain adjustments if the stock price dipped below $97.91.
News of the potential Warner Bros. acquisition has provoked a mixed reaction across Hollywood, with warnings issued regarding industry risks and calls made for regulators to block the arrangement. Advisors to U.S. President Donald Trump suggest that Netflix already commands a substantial market share, which an acquisition would significantly boost.
Industry figures, speaking to the FT, expressed concerns that the merger would decrease the number of entities purchasing television series and films, inevitably leading to a reduction in overall industry workload. Netflix co-CEO Greg Peters, however, maintained that the Netflix arrangement would enable Warner Bros. to expand its U.S. film production capabilities and sustain investment in original content.
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