Netflix Revises Warner Bros. Discovery Bid with All-Cash Offer

In a significant strategic shift, Netflix announced on Tuesday that it has amended its acquisition proposal for Warner Bros. Discovery (WBD). The revised deal structure now consists of a straightforward all-cash offer, a move designed to counter a competing hostile bid from Paramount Skydance and to expedite the shareholder approval process. The market responded positively to the increased certainty this change provides.

The critical shareholder vote on the Netflix proposal is anticipated in April 2026. Warner Bros. Discovery has taken a concrete step toward this timeline by filing its preliminary proxy statement with the SEC. This development signals a clear intent to move forward with the vote. However, the path to completion remains complex. Paramount Skydance continues to maintain pressure, having announced an extension of its own $108.4 billion offer for the entire WBD conglomerate. Furthermore, the transaction is expected to face intense regulatory scrutiny, a point Paramount's chief legal officer has already begun emphasizing publicly. The company's Q4 2025 financial results are scheduled for release in late February.

From Stock Swap to Pure Cash

The core change in the agreement is the elimination of a stock-swap component. Netflix is now offering a flat $27.75 per WBD share in cash, maintaining the previous valuation but removing the uncertainty associated with an exchange of equity. This adjustment provides WBD shareholders with precise clarity on the value they will receive upon the deal's closing, insulating them from future fluctuations in Netflix's share price.

Should investors sell immediately? Or is it worth buying Warner Bros. Discovery (A)?

To finance the acquisition, Netflix has secured debt commitments totaling $42.2 billion. The company plans to supplement this with cash from its own reserves and existing credit facilities.

WBD Board Maintains Preference for Netflix Agreement

The Warner Bros. Discovery board of directors has consistently expressed its preference for the Netflix proposal. Its position is based on a key distinction between the two offers. The board characterizes Paramount's bid as effectively a leveraged buyout, which would require Paramount to assume over $50 billion in new debt—a scenario it deems an excessive risk for WBD shareholders.

Consequently, the choice for investors has become more defined. Netflix is proposing a fixed price for WBD's restructured media assets, which include its streaming operations and studio divisions like HBO and Warner Bros. Pictures, while the linear television networks would be spun off. In contrast, Paramount aims to acquire the entire corporation.