Netflix Transforms Warner Bros. Acquisition into All-Cash Deal

Netflix has revised its merger agreement with Warner Bros. Discovery, shifting the acquisition from a mixed structure to an all-cash deal. Under the new terms, Warner Bros. Discovery (WBD) stockholders will receive $27.75 per share, totaling an enterprise value of $82.7 billion, which includes debt. The deal aims to enhance value certainty for stockholders while expediting the approval process.

In addition to the cash payment, WBD stockholders will also receive shares of Discovery Global following its planned separation from Warner Bros. Discovery. This amendment is designed to simplify the transaction and facilitate a quicker stockholder vote, expected to occur by April 2026. Warner Bros. Discovery has already filed a preliminary proxy statement with the US Securities and Exchange Commission to support this timeline.

Details of the Acquisition

The all-cash acquisition will be financed through a combination of Netflix’s existing cash reserves, available credit facilities, and committed financing. Both Netflix and Warner Bros. Discovery’s Boards of Directors have unanimously approved the revised agreement, which is a significant shift from the earlier structure that included non-cash components.

The completion of the transaction is contingent upon several factors, including the successful separation of Discovery Global, stockholder approval from Warner Bros. Discovery, regulatory approvals, and customary closing conditions. The separation of Warner Bros. and Discovery Global into two independently traded companies is anticipated to occur within six to nine months before finalizing the Netflix–Warner Bros. agreement.

Regulatory Engagement and Future Outlook

To comply with regulatory requirements, Netflix and Warner Bros. Discovery have filed under the Hart-Scott-Rodino Act and are currently engaging with key regulatory bodies such as the US Department of Justice and the European Commission. Notably, the financing structure of the deal is not subject to review by the Committee on Foreign Investment in the United States (CFIUS).

Both companies continue to expect the transaction to close within 12–18 months from the date of the original merger agreement. As the landscape evolves, this all-cash structure is expected to streamline the transaction process while providing clarity for stakeholders involved.