Why Netflix dropped Warner deal for Paramount's $31 per share
Netflix dropped its plan to buy Warner Bros. Discovery when Paramount Skydance offered a higher $31 per share, outbidding Netflix's earlier $27.75 offer.
Co-CEO Ted Sarandos put it simply: "We knew right away, when we got the notice on Thursday that they had a superior offer and the details of that deal," and "We knew exactly what we were going to do."
The bidding war for Warner Bros. assets
Netflix had a deal lined up for Warner Bros. and HBO Max, but on February 26, Paramount Skydance's superior offer was reported that included all assets—even CNN.
This triggered a seven-day window (the waiver) for Netflix to match the offer or walk away.
What's next for Netflix and Paramount?
Instead of raising their bid, Netflix chose to take a $2.8 billion breakup fee and focus on making more original content—planning to continue investing in original content.
After some initial stock drops and skepticism from some investors, Netflix is sticking with its strategy of growing globally through fresh content, while timing for Paramount's deal was unclear.