- Netflix has abandoned plans to buy Warner Bros. Discovery
- This comes after Paramount made WBD a “superior offer”
- And after Donald Trump threatened Netflix over one of its board members
Netflix has conceded to Paramount in the duo’s battle to acquire Warner Bros. Discovery. It’s a twist no one expected.
Many had believed that after the WBD board declared Paramount’s newly revised offer of $31 per stock to be “superior” to what Netflix had on the table, Netflix would take the four-day period it had to revise its offer to come back with an even higher bid. Instead, it pulled out completely.
This means that Paramount is set to buy Warner Bros. Discovery, that is, unless it gets blocked by regulators – more on that in a moment.
It is impossible to ignore the political side of this.
Netflix’s exit from the negotiating table comes just days after US President Donald Trump demanded it fire former US national security adviser Susan Rice from its board or “pay the consequences” if it chose not to – a comment that can’t help but be interpreted as a threat to block a Netflix WBD deal, especially after Trump had previously said he wanted an unprecedented level of negotiating involvement.
At the same time, you have Paramount’s strong ties to the Trump-friendly Ellison family. David Ellison is the CEO of Paramount Skydance, and his father Larry is cashing in some of the money in Paramount’s bid to buy WBD and is also involved in US-owned TikTok.
Their Trump allies go beyond just being friendly with the president, from the cancellation of Stephen Colbert’s The Late Show apparently at the request of Trump — who is a vocal critic of Colbert and other popular late-night hosts — to a sense of erosion of CBS News’ impartiality as executives cut segments critical of the administration’s actions while promoting all of the administration’s programs and programs.
Watchdog groups fear similar actions could be taken with WBD’s CNN once Paramount is in charge. “The Ellisons have already promised the Trump administration that they will make sweeping changes to CNN given the chance, and we know what that means: firing reporters, spiking important stories and replacing the news with empty propaganda,” said Free Press co-CEO Craig Aaron (via Variety ).
Meanwhile, Variety reports that an executive at Warner Bros. has called the result a “gut punch,” suggesting even higher ups at WBD were hoping for a Netflix win.
The Hollywood drama returns
That said, this is still not a done deal.
Paramount’s Trump ties suggest some US regulators may rubber stamp the deal. However, California Attorney General Rob Bonta has said that the California Department of Justice will investigate and review the deal, and non-US boards such as the EU may also find problems with the merger.
Paramount and Warner Bros. make up massive chunks of the film industry, as does Netflix, and any deal here will be closely scrutinized by regulators.
So we will have to continue to watch this space. Even though Netflix has bowed out, that doesn’t mean this Hollywood drama has reached its conclusion. This is just the end of 1. law.
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