Warner Bros Discovery has agreed to be acquired by Paramount Skydance in an US$110 billion transaction, ending a high-stakes bidding war after Netflix walked away from its agreement with the HBO Max owner, Reuters reported.
The deal, which carries an equity value of US$81 billion, is expected to close in the third quarter of 2026, the companies said on Feb 27. Warner shareholders are set to vote on the proposed merger in early spring 2026.
The tie-up would create a Hollywood heavyweight, combining assets including CNN and CBS as traditional studios race to adapt to a streaming-dominated landscape. The merged company will control a film library of more than 15,000 titles and marquee franchises such as Game of Thrones, Mission: Impossible, Harry Potter, the DC Universe, Fantastic Beasts and The Matrix.
Netflix declined to match Paramount’s improved US$31-per-share offer, which topped its earlier US$27.75-per-share agreement for Warner’s studio and streaming assets. Paramount also paid the US$2.8 billion termination fee owed to Netflix.
The acquisition will be financed with US$47 billion in equity from the Ellison family and RedBird Capital Partners, alongside US$54 billion in debt commitments from Bank of America, Citigroup and Apollo.
Paramount also plans a rights offering of up to US$3.25 billion in Class B shares. The companies project more than US$6 billion in cost savings through technology integration and operational efficiencies.
Shares of Paramount rose about 3% in extended trading, while Netflix slipped 1%.
However, the blockbuster merger faces regulatory scrutiny. California Attorney General Rob Bonta said the state is already investigating the transaction and will conduct a “vigorous” review. While European Union antitrust approval is expected to be manageable, US lawmakers have voiced concerns over reduced competition and higher consumer prices.
Led by David Ellison, son of billionaire Larry Ellison, Paramount has pursued Warner since late last year, escalating its bid and raising the reverse termination fee to US$7 billion to secure board approval.
If cleared, the merger would mark one of Hollywood’s largest shake-ups in years, reshaping the competitive landscape as legacy media companies scale up to compete in the streaming era.
