Netflix to Acquire Warner Bros. in $82.7 Billion Deal

In news that will change the entertainment world forever, Netflix announced they have struck a deal to acquire Warner Bros., including, per the press release, “its film and television studios, HBO Max and HBO.”

Per the release, “under the terms of the agreement, each WBD shareholder will receive $23.25 in cash and $4.50 in shares of Netflix common stock for each share of WBD common stock outstanding at the closing of the transaction. The transaction values Warner Bros. Discovery at $27.75 per share, implying a total equity value of approximately $72.0 billion and an enterprise value of approximately $82.7 billion.”

Netflix is just buying those aforementioned portions of Warner Bros. Discovery; the rest of the conglomerate’s businesses, including cable channels like CNN, will proceed with a planned spinoff into a new company named Discovery Global, will remain separate from this new Netflix/WB entity.

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Netflix claims that the deal “brings together two pioneering entertainment businesses, combining Netflix’s innovation, global reach and best-in-class streaming service with Warner Bros.’ century-long legacy of world-class storytelling. Beloved franchises, shows and movies such as The Big Bang Theory, The Sopranos, Game of Thrones, The Wizard of Oz and the DC Universe will join Netflix’s extensive portfolio including Wednesday, Money Heist, Bridgerton, Adolescence and Extraction, creating an extraordinary entertainment offering for audiences worldwide.” (Yes, among countless other massive elements of this news, if this deal closes it would mean that Netflix now owns Superman, Batman, Wonder Woman, and the rest of the heroes and villains of the DC Comics library.)

Ted Sarandos, co-CEO of Netflix said of the deal:

Our mission has always been to entertain the world. By combining Warner Bros.’ incredible library of shows and movies—from timeless classics like Casablanca and Citizen Kane to modern favorites like Harry Potter and Friends—with our culture-defining titles like Stranger Things, KPop Demon Hunters and Squid Game, we'll be able to do that even better. Together, we can give audiences more of what they love and help define the next century of storytelling.

Netflix claims in the press release that it “expects to maintain Warner Bros.’ current operations and build on its strengths, including theatrical releases for films.” But Netflix’s core business is streaming video, and they have long resisted expanding their business into movie theaters. (Just last April, Sarandos publicly called movie theaters “an outdated concept.”) It’s hard to believe this news is good for movie theaters, or for fans of the theatrical moviegoing experience.

There are many regulatory hurdles that will have to be cleared before the deal is finalized, and even under the quickest timeline it’s still years away, as it can’t happen until after Warner Bros. splits from Discovery late next year. But if this acquisition happens, it would create one of the biggest media companies in the world, and almost instantly reshape the entire landscape of film and television as we know it.