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In a seismic shift for the entertainment industry, Netflix has announced a definitive agreement to acquire Warner Bros. Discovery's film and television studios, HBO, and HBO Max for a total enterprise value of approximately £62 billion (equity value of £54 billion), following the spin-off of WBD's Discovery Global networks. The cash-and-stock transaction, valued at £20.81 per WBD share, marks the end of a fierce bidding war that saw Netflix outmaneuver rivals including Paramount and Comcast.
Deal Breakdown
- Per Share: £17.44 cash + £3.37 in Netflix stock
- Total Value: £62 billion enterprise (£54 billion equity)
- Timeline: Expected to close in Q3 2026, post-Discovery Global spin-off (12-18 months)
- Assumed Debt: Over £7.5 billion
Shareholders will receive the fixed mix upon closing, subject to a collar mechanism.
Gaming Revolution: Warner Bros. Games Joins Netflix Empire
The acquisition catapults Netflix into the gaming arena, absorbing Warner Bros. Games and its blockbuster franchises including DC Comics titles, Hogwarts Legacy, Mortal Kombat, and more. This move aligns with Netflix's push into interactive entertainment, potentially accelerating mobile and cloud gaming integrations with HBO Max's vast audience. Expect crossovers like Gears of War animated series and enhanced live-service titles under Netflix's global reach.
Industry watchers predict shorter theatrical windows for WB films to prioritize streaming, meeting audiences "where they are, quicker," while maintaining cinema releases.
Content Powerhouse Unleashed
Netflix gains iconic IP: Harry Potter, Game of Thrones, The Sopranos, DC Universe, The Lord of the Rings, and classics like Casablanca. Co-CEO Ted Sarandos hailed it as uniting "Warner Bros.’ incredible library" with Netflix hits like Stranger Things and Squid Game to "define the next century of storytelling."
WBD CEO David Zaslav's memo to staff called it a "generational change," emphasizing strengthened Hollywood innovation.
Market Reactions and Hurdles Ahead
Netflix shares dipped over 2% on the news, while WBD surged to a three-year high above £18.75 per share. Regulators face intense scrutiny over market concentration, with potential antitrust probes from the DOJ and EU, plus opposition from theater chains and guilds. Netflix anticipates EPS accretion by year two post-close.
Currency conversions based on December 5, 2025 exchange rate of approximately £0.75 per $1 USD. Subject to regulatory approval; deal not yet finalized.