Netflix wants to acquire parts of Warner Bros. Discovery For $72 billion (€84 billion), the streaming giant announced on Friday.
If regulators approve, the merger would unite two of the biggest names in entertainment, Netflix and Warner Bros., the studio behind “Harry Potter,” “Game of Thrones” and the DC films.
The combined company will control a vast library of movies and shows, from Stranger Things and Squid Game to Warner’s centuries-old catalog.
The deal does not include networks like CNN and Discovery.
What does the deal mean for Netflix and Warner Bros.?
Netflix wants to acquire Warner Bros. Film and television studios, HBO Max and HBO.
“Our mission has always been to entertain the world,” Netflix co-chief executive Ted Sarandos said in a joint statement with Warner Bros. Discovery.
Sarandos said the deal would combine Warner Bros.’ Netflix’s “incredible library” of movies and TV shows with signature productions.
Warner Bros. has produced Hollywood classics like “Casablanca” and “Citizen Kane” as well as modern blockbuster film series like “Harry Potter” and blockbuster TV hits like “Friends,” “The Sopranos” and “Game of Thrones.”
Netflix, on the other hand, is responsible for shows like “Stranger Things” and “Squid Game” and the movie “Kpop Demon Hunters.”
“Together, we can give audiences more of what they love and help define the next century of storytelling,” Sarandos said.
In a joint statement, David Zaslav, chairman and CEO of Warner Bros. Discovery, said Friday’s announcement “combines two of the world’s greatest storytelling companies.”
What else do we know about the deal between Netflix and Warner Bros.?
The cash and stock transaction is valued at $27.75 per Warner Bros. share, giving a total enterprise value of approximately $82.7 billion and an equity value of $72.0 billion.
The deal was unanimously approved by the boards of both companies. The companies said it is expected to be approved within a year to 18 months.
What has been the reaction to the deal?
The deal, which means the world’s largest streaming service will own one of its major rivals, is likely to be closely scrutinized in the US and Europe.
Paramount, which had outbid Netflix, has raised concerns about the sale process and claimed that Netflix received favorable treatment.
Before the deal was announced, someone in the US Congress said such a consolidation would harm consumers and Hollywood.
Cinemas United, a trade organization that represents movie theaters across the US, said it was an “unprecedented threat” to theaters around the world.
Jason Kilar, former CEO of WarnerMedia, said he “cannot imagine a more effective way to reduce competition in Hollywood.”
“Titanic” director James Cameron said before the announcement that any Netflix acquisition of Warner Bros. would be a “disaster” for movie theaters, citing concerns that the streaming giant might want to limit cinema releases of its film productions.
Kathleen Brooks, a researcher at trading and investment firm XTB, told the AFP news agency that Netflix aims to “dominate Hollywood.” He warned that the deal raises several potential issues, namely Netflix’s monopoly on the TV and film business.
Brooks also noted that such a large deal would require regulatory approval from US antitrust authorities.
Editor’s note: This story has been updated to reflect the deal’s $72 billion equity value and to clarify that CNN and Discovery are not included.
Edited by: Shawn Sinico