Sources familiar with the negotiations told Reuters that what began as a routine fact-finding exercise for Netflix quickly evolved into a serious acquisition attempt after Warner Bros Discovery opened a formal auction on October 21. Prior to that, WBD had rejected three unsolicited bids from Paramount’s Skydance consortium.

Why Netflix Wanted Warner Bros

Netflix executives were initially drawn by the opportunity to explore WBD’s business structure. They soon realised that acquiring the century-old studio would not only strengthen Netflix’s position but also offer strategic advantages. Warner Bros’ extensive library—including blockbuster films, legacy TV shows, and HBO originals—remains among the most valuable in entertainment. According to one source, library titles can account for nearly 80% of overall streaming viewing.

The company also recognised the potential to improve HBO Max’s performance using the data-driven insights Netflix has refined over years of global streaming leadership.

Competitive Bidding Intensifies

The race to acquire Warner Bros Discovery tightened this autumn, with Netflix competing directly against Comcast (NBCUniversal’s parent company) and Paramount. The auction process began shortly after WBD announced plans to split into two publicly traded entities—separating its cable television networks from its film studio, HBO, and streaming assets.

Financial advisers from Moelis & Company, Wells Fargo, and legal experts from Skadden, Arps, Slate, Meagher & Flom supported Netflix’s effort. Executives reportedly held daily morning calls for weeks and worked through the Thanksgiving holiday to finalise the bid ahead of the December 1 deadline.

Meanwhile, WBD’s board met every day in the final stretch, evaluating each competing proposal.

Why Warner Bros Chose Netflix

The board ultimately favoured Netflix’s offer, viewing it as the most complete and immediately beneficial. Comcast had proposed a mega-merger between NBCUniversal and Warner Bros Discovery, creating a combined entertainment powerhouse. However, sources said the plan would have taken years to execute and involved significant regulatory uncertainty.

Paramount, which had raised its offer to $30 per share—valuing WBD at around $78 billion—was unable to convince the board about its financing structure.

Netflix, in contrast, not only presented a fully backed $72 billion deal but also offered one of the largest breakup fees in corporate history: $5.8 billion, signifying its confidence in clearing regulatory approvals.
“No one lights $6 billion on fire without that conviction,” a source remarked.

Inside the Final Hours

According to people in the room, Netflix leaders still believed they had “only a 50–50 chance” of success until late Thursday night, when an official confirmation finally arrived. The news reportedly sparked applause and cheering on a group call among Netflix executives and advisers.

Both Netflix and Warner Bros Discovery declined to comment publicly on the ongoing regulatory steps.

The acquisition, once completed, will create a streaming-and-studio combination unmatched in size and global reach, setting a new benchmark for the entertainment industry.