Netflix is reportedly preparing to upgrade its acquisition offer for Warner Bros. Discovery to an all-cash structure, eliminating the stock component that has lost value since the initial proposal. The move reflects growing urgency and confidence in securing the deal amid shifting market dynamics.
- Netflix is reportedly considering an all-cash offer of $65 billion for Warner Bros. Discovery.
- The move follows a decline in WBD’s stock value since the initial bid was proposed.
- The revised structure removes the stock component, reducing risk for WBD shareholders.
- The deal would grant Netflix access to major franchises including DC Comics and HBO content.
- Market reaction shows NFLX up 4.2% and WBD up 6.8% in pre-market trading.
- Regulatory approvals and antitrust reviews remain critical hurdles to closing.
Netflix is exploring a revised merger proposal for Warner Bros. Discovery (WBD) that would replace the original mixed-stock-and-cash offer with a fully cash-based transaction. The shift comes as the value of WBD stock has declined significantly since the initial bid was announced, undermining the original structure's attractiveness. The revised offer is expected to be valued at approximately $65 billion, aligning with the pre-announcement valuation of the deal. This adjustment underscores Netflix’s determination to close the acquisition despite market volatility and investor skepticism around content-heavy media assets. The strategic pivot highlights broader industry challenges in the streaming sector, where rising content costs and subscriber stagnation have pressured margins. With Netflix aiming to strengthen its long-term content library ahead of upcoming programming cycles, securing WBD’s vast film and television catalog—including franchises like DC Comics, Harry Potter, and HBO originals—represents a critical growth lever. The all-cash formulation reduces risk for WBD shareholders, who have seen their equity value fluctuate amid macroeconomic headwinds and sector-specific pressures. Market reaction has already begun to reflect the potential transformation. In pre-market trading, NFLX shares rose 4.2% while WBD stock gained 6.8%, signaling investor anticipation of a final agreement. Analysts note that a successful all-cash deal would significantly alter the competitive landscape, potentially enabling Netflix to challenge Disney and Amazon in content ownership while accelerating its global expansion. The transaction remains subject to regulatory approval and shareholder consent, with key hurdles expected in antitrust reviews across the U.S. and EU.