Netflix has reworked its proposed takeover of Warner Bros Discovery, switching to an all-cash offer in an effort to shut down Paramount’s rival bid and bring the high-stakes Hollywood battle closer to a resolution. The revised proposal keeps the overall valuation unchanged but removes stock from the equation, a move designed to reassure investors after volatility in Netflix’s own share price.
Under the new terms, Netflix will pay $27.75 per share in cash for Warner Bros’ studio and streaming assets, valuing the deal at about $82.7 billion. Warner Bros disclosed in a regulatory filing that its board unanimously supports the revised offer. The previous proposal combined cash with Netflix stock, an element Paramount had repeatedly criticized as risky given the streaming giant’s recent share-price decline.
Netflix and Paramount Skydance have both been pursuing Warner Bros Discovery for its film and television studios, vast content library, and marquee franchises including “Harry Potter,” “Game of Thrones,” and DC Comics’ superheroes. Paramount, led by David Ellison, has mounted an aggressive campaign to persuade shareholders that its $30-per-share cash bid offers better value, but Warner Bros has continued to reject those advances.
All-cash structure aims to reassure investors before key vote
Netflix said the revised structure allows for a faster path to a shareholder vote and provides greater certainty on value. Co-CEO Ted Sarandos said the all-cash deal removes market risk and simplifies the decision for investors. Warner Bros plans to hold a special shareholder meeting to vote on the transaction, which Netflix expects to take place by April.
Market reaction was muted. Netflix shares edged higher in early trading, while Paramount and Warner Bros shares slipped slightly. Some investors believe the bidding contest may not be finished. A portfolio manager at Harris Oakmark, one of Warner Bros’ largest shareholders, said the revised offer increases pressure on Paramount to respond quickly if it intends to stay in the race.
The shift comes after Netflix shares fell nearly 15% following the original merger announcement in December, dropping below the floor price embedded in the earlier stock component. Paramount had pointed to that decline as evidence its offer carried less risk. By moving to an all-cash bid without raising the price, Netflix appears to be betting that certainty will outweigh Paramount’s higher headline number.
Warner Bros has continued to argue that Netflix’s proposal delivers superior value once investors account for Discovery Global, a planned cable spin-off that would remain with existing shareholders. Paramount has dismissed that business as effectively worthless, but Warner Bros’ advisers have assigned it a wide valuation range, depending on future deal prospects.
Paramount’s tender offer is set to expire on January 21. A Delaware judge last week rejected Paramount’s request to force faster disclosure of Warner Bros’ financial analyses, a setback that limits its ability to sway investors in the final days. Analysts say that unless Paramount raises its bid, its remaining appeals may carry little weight.
For Netflix, the all-cash pivot marks a tactical shift rather than a price escalation. Whether it succeeds will depend on how Warner Bros shareholders weigh certainty today against the promise of a potentially richer, but riskier, alternative.
