Netflix Walks Away From Warner Bros.

Never come between an Ellison and their prey. Especially if hugely expensive Oracle finds itself getting sidelined by AI and Blockchain, while struggling with high debt levels, the family will need something else to focus on, and it looks like it might be entertainment. After setting up Skydance and taking over Paramount, they now have a clear run at Warner Bros.

Netflix has backed away from its own proposal to buy Warner Bros Discovery. Yesterday, Paramount declared its latest bid as “superior”, and Netflix refused to match it.

“Told you!”

The deal Paramount put on the table was worth around $110 billion (£81.7 billion or Eur93.2 billion). Netflix executives say that matching Paramount’s bid makes:

“…the deal is no longer financially attractive…”

If the deal goes through, it will create a studio behemoth that could reshape the media landscape. Netflix co-chief executives Ted Sarandos and Greg Peters said in a statement:

“The transaction we negotiated would have created shareholder value with a clear path to regulatory approval; however, we’ve always been disciplined. This transaction was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.”

The announcement came just hours after Sarandos had visited the White House on Thursday, and brings to an end a dramatic boardroom tussle.

The next hurdle is the regulators. Many in the industry were uncomfortable with the Netflix bid, will they feel better about Paramount?

California Attorney General Rob Bonta said later on Thursday that the potential merger:

“…is not a done deal. These two Hollywood titans have not cleared regulatory scrutiny – the California Department of Justice has an open investigation, and we intend to be vigorous in our review…”

The Paramount deal would also require the approval of the US Department of Justice and European regulators.