- Primary Subject: Warner Bros. Discovery Acquisition
- Key Update: Netflix has officially withdrawn from bidding for Warner Bros. Discovery after being outbid by a $31-per-share offer from Paramount Skydance.
- Status: Confirmed
- Last Verified: February 27, 2026
- Quick Answer: Paramount Skydance is the likely buyer of Warner Bros. Discovery after Netflix declined to match a higher bid, securing a $2.8 billion termination fee instead.
After appearing poised to acquire Warner Bros. Discovery, Netflix has backed out of the bidding war following a potentially larger cash offer from Paramount Skydance.
But despite the unexpected twist, Netflix still emerged a winner, with its shares surging shortly after the announcement. So, what comes next in this dramatic media industry shake-up?
Netflix vs. Paramount Skydance: What Really Happened?
Paramount Skydance now appears to be the likely winner in the months-long battle to acquire Warner Bros. Discovery after Netflix officially walked away from the bidding war, refusing to raise its offer.
“We’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the bid,” Netflix said in a statement, via Reuters.
However, Warner Bros. Discovery’s board must still formally terminate Netflix’s agreement and approve Paramount Skydance’s proposal for the merger to move forward.
“Once our board votes to adopt the Paramount merger agreement, it will create tremendous value for our shareholders,” Warner CEO David Zaslav said. “We are excited about the potential of a combined Paramount Skydance and Warner Bros. Discovery and can’t wait to begin working together to tell the stories that move the world.”
Paramount Skydance outbid Netflix’s $27.75-per-share offer with a $31-per-share proposal. The higher bid successfully brought the company back to the negotiating table, with discussions reportedly continuing over a possible increase in cash consideration.
How Did Netflix Win After Backing Out of the Warner Bros. Discovery Bidding War?
An anonymous Netflix adviser told Reuters that they had recommended the company to back out from the bidding war, as the deal was no longer financially viable.
In fact, Netflix co-CEO Ted Sarandos hinted in an interview with Fox News’ Liz Claman on February 20 that the company had no plans to raise its offer further, emphasizing that Netflix has been “very disciplined buyers.”
The adviser added that the streaming giant was facing a billionaire willing to pay Warner Bros. a significant sum, which Netflix no longer considered logical, referring to Larry Ellison, co-founder, executive chairman, and CTO of Oracle Corporation, and father of David Ellison, CEO of Paramount Global.
“There’s no point in playing chicken with someone who won’t turn the wheel,” the source said.
Despite stepping back, Netflix still recorded a major win as its shares surged more than 10% following its exit from the bidding war.
Warner Bros. also now owes Netflix a $2.8 billion fee for walking away from the merger agreement, which Paramount has agreed to pay.
“Netflix’s decision not to raise its offer of $27.75 per share, before net debt adjustments, has paved the way for shareholders to receive significantly more cash and a truly viable path to government approvals,” said Ancora Holdings, an activist investor with a small stake in Warner Bros. who had pushed the company to engage more actively with Paramount. “This is a win-win for shareholders and the industry.”
While Paramount emerged victorious in the bidding war, Netflix still walked away with its own advantage.
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