Netflix Counters Paramount With All‑Cash Proposal for Warner Bros.

Netflix and Warner Bros. say this will provide the greatest value to shareholders, consumers, and the entertainment industry.

Netflix and Warner Bros. Discovery logos, in this illustration created on Dec. 5, 2025. Dado Ruvic/Reuters

Streaming titan Netflix has adjusted its offer for Warner Bros. Discovery, according to a Jan. 20 Securities and Exchange Commission filing.

Netflix stated that it will now pay all cash for Warner Bros. and HBO, rather than a mix of cash and stock, citing its strong cash flow.

The company is offering $27.75 per Warner Bros. share for the entertainment empire’s film studio and streaming assets. CNN and other channels owned by Warner Bros. Discovery will transition to a separate entity called Discovery Global.

A Netflix–Warner Bros. merger would “deliver the best outcome” for investors, consumers, and the entertainment industry, according to Ted Sarandos, co-CEO of Netflix.

“Together, Netflix and Warner Bros. will deliver broader choice and greater value to audiences worldwide, enhancing access to world-class television and film both at home and in theaters,” Sarandos said in a statement.

“The acquisition will also significantly expand U.S. production capacity and investment in original programming, driving job creation and long-term industry growth.”

David Zaslav, president and CEO of Warner Bros. Discovery, suggested that the amended offer brings the two companies closer to inking an agreement.

“Today’s revised merger agreement brings us even closer to combining two of the greatest storytelling companies in the world and with it even more people enjoying the entertainment they love to watch the most,” Zaslav said in a statement.

Keeping Paramount at Bay

The move could potentially fend off Paramount Skydance’s repeated hostile takeover bid.

Since early December, Paramount has made several attempts to acquire Warner Bros. with an all-cash offer of $108.4 billion, higher than Netflix’s initial proposal of $72 billion—$23.25 in cash and $4.50 in Netflix stock for each outstanding share.

The Warner Bros. board of directors has instead urged stockholders to rebuff the proposal, saying that the Netflix deal is superior since it is less leveraged and far more likely to be approved by regulators.

Warner Bros. stated in its filing that Netflix maintains an investment‑grade credit rating, while Paramount’s debt is classified as junk by the S&P 500 and may face additional financial and regulatory strain.

The board has also stated that the Netflix deal offers shareholders greater value because they would retain a stake in the separately traded Discovery Global.

They had previously expressed disappointment that technology billionaire Larry Ellison did not have a greater presence in negotiations. However, Paramount later amended its offer and confirmed that Ellison, father of Paramount CEO David Ellison, would back the deal.

Last week, Paramount filed a lawsuit against Warner Bros. after the entertainment giant rejected its offer, arguing that it did not provide shareholders with sufficient financial disclosure.

Paramount’s tender offer expires on Jan. 21.

Paramount Global and Skydance logos, in this illustration taken on Dec. 17, 2024. Dado Ruvic/Reuters

In addition to securing support from stockholders, the companies also need to garner approval from lawmakers. Officials on both sides of the aisle, including President Donald Trump, have voiced concern about a possible Netflix–Warner Bros. merger.

Market Snapshot

The share price of Netflix (NFLX) rose by more than 1 percent following the news, while the Warner Bros. (WBD) share price slipped by about 0.3 percent. Paramount (PSKY) share prices fell by nearly 1 percent.

Market watchers think that Netflix is a steal for investors, as it trades firmly below its 52-week high. The stock price has fallen by about 15 percent since the company unveiled its plan to acquire Warner Bros.

“The business at Netflix is doing fine, and the stock is just on sale because of the Warner Brothers situation,” Eric Clark, chief investment officer at Accuvest, said in a note emailed to The Epoch Times.

“The overhang will be removed whether they get Warner Brothers or not, and once the merger uncertainty clears, the arbitrage players who are long Warner Brothers and short Netflix will pack it in. Netflix should move sharply higher after that.”

The broader stock market was deep in the red as traders returned from the Martin Luther King Jr. Day holiday weekend, with the leading benchmark averages falling by more than 1 percent.

Evgenia Filimianova contributed to this report.