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Netflix on Tuesday announced that it amended its deal to buy Warner Bros. Discovery’s studios and HBO Max streaming business to an all-cash offer.
The deal is still priced at $27.75 per share, the same as before. The overall value of Netflix’s offer remains $72 billion.
Warner Bros. Discovery stockholders will receive additional value in the form of shares in Discovery Global once it splits off from the company. Netflix plans to pay for the deal using its existing cash, credit lines and financing it has already lined up.
PARAMOUNT REFUSES TO BACK DOWN IN WARNER BROS. DISCOVERY TAKEOVER FIGHT AGAINST NETFLIX
“Our revised all-cash agreement will enable an expedited timeline to a stockholder vote and provide greater financial certainty at $27.75 per share in cash, plus the value from the planned separation of Discovery Global,” said Ted Sarandos, Netflix’s co-CEO.
NETFLIX TO BUY WARNER BROS. DISCOVERY IN $72B DEAL
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| NFLX | NETFLIX INC. | 87.05 | -0.95 | -1.08% |
| WBD | WARNER BROS. DISCOVERY INC. | 28.24 | -0.34 | -1.19% |
Netflix shares have fallen almost 15% since announcing the merger on Dec. 5, closing at $88 per share on Friday – well below the $97.91 floor price of the original bid. That drop was part of Paramount’s argument that its bid was superior.
Both Netflix and Paramount Skydance covet Warner Bros for its leading film and television studios, extensive content library and major franchises such as “Game of Thrones,” “Harry Potter” and DC Comics’ superheroes Batman and Superman.
Warner Bros will hold a special investor meeting to vote on the Netflix deal, with the streaming pioneer saying that the meeting was expected to be held by April.
Paramount has altered its terms and engaged in an aggressive media campaign to try to convince shareholders that its bid is superior, but Warner Bros has spurned the David Ellison-led company. Paramount Skydance’s tender offer expires on Jan. 21.
The board has maintained that the Netflix merger deal is superior to Paramount Skydance’s $30-per-share cash bid for the company because Warner Bros’ investors would retain a stake in the separately traded Discovery Global.
Reuters contributed to this report.
