The most dramatic acquisition in Hollywood history appears to have come to a close. Streaming company Netflix has officially announced its withdrawal from the bidding war for Warner Bros. Paramount Skydance, the long-established entertainment company, ultimately acquired the century-old studio with an all-cash offer of $31 per share, valuing the company at approximately $111 billion (about S$140.3 billion).
Reuters and NBC News reported on Friday (February 27th) that Paramount and Warner Bros. announced in a joint statement that the deal had been unanimously approved by their respective boards of directors, but still requires approval from Warner Bros. shareholders, with the vote expected in early spring 2026.
The statement also noted that the merged company will possess a vast library of over 15,000 films and television series, including franchises such as *Game of Thrones* and *Harry Potter*.
However, Paramount has not yet released specific details of the asset integration, such as whether it will merge CNN and CBS News into a single news organization.
The report cites SEC filings indicating that while Netflix abandoned the acquisition, it did not leave empty-handed, receiving a $2.8 billion “ceasefire” fee from Paramount.
Following the announcement of the abandoned acquisition, Netflix’s stock price surged over 10% in after-hours trading, breaking recent highs. Paramount’s stock price jumped 20%.
Netflix President Ted Sarandos stated that Netflix has always adhered to stringent ROI evaluation standards, and its attitude towards Warner Bros.’ assets has always been “a bonus if the price is right, not a takeover at all costs.” When Paramount’s offer approached the critical threshold of Netflix’s financial model, abandoning the acquisition became the only rational choice.
Having shed the burden of the bidding war, Netflix immediately stated that it will continue to maintain a massive content investment of approximately $20 billion in 2026, focusing on original film, television, and gaming businesses.
Paramount went all out to completely thwart Netflix’s acquisition attempt. Besides significantly increasing its offer to $31 per share, a substantial rise from Netflix’s initial offer of $27.75, Paramount also fully assumed the $2.8 billion penalty payable to Netflix to allay the concerns of Warner Bros.’ board, significantly advanced the 25-cent “time fee” per share, and established a regulatory termination fee of up to $7 billion.
If the deal is rejected by antitrust authorities, Paramount will face nearly $10 billion in sunk costs. This all-or-nothing approach effectively shuts down any further Netflix attempts to acquire it.
HSBC analyst Mohammed Khallouf said, “With Netflix out of the race, it can refocus on its core business, while its closest competitors will have to contend with lengthy and distracting regulatory approvals and M&A integration processes.”
This $111 billion deal may only be the beginning for Hollywood and the global entertainment industry. The merger of Paramount and Warner Bros., two century-old studios, will inevitably lead to business overlap, large-scale layoffs, and a sharp decline in the number of film and television projects approved.
Furthermore, as the number of major buyers of film and television works dwindles, the voice of creators will be irreversibly compressed. For the average consumer, the ultimate cost of oligopoly will inevitably be the ever-increasing numbers on streaming subscription bills.
