From deal size to antitrust scrutiny— key things to know as Netflix moves to buy Warner Bros film and streaming unit

Netflix has agreed to acquire Warner Bros Discovery's TV and film studios and streaming division for $72 billion, a blockbuster deal that would give the streaming division control of one of Hollywood's oldest assets and most prized entertainment empires.

Through this deal, Netflix will gain control of iconic franchises such as “Game of Thrones”, “DC Comics”, and “Harry Potter”. It will also strengthen the streaming giant's hand against rivals like Disney and the Ellison family-backed Paramount.

“Together, we can give audiences more of what they love and help define the next century of storytelling,” Netflix co-CEO Ted Sarandos was quoted as saying by Reuters.

All about the mega deal

— Weeks-long bidding war:

The agreement, announced on Friday, was finalised after weeks-long bidding war in which Netflix pulled ahead with an offer of nearly $28-a-share, thereby topping Paramount Skydance's nearly $24 bid for the whole of Warner Bros Discovery, including the cable TV assets set to be spun off.

David Ellison-led Paramount, which kicked off the bidding war with a series of unsolicited offers and has close ties with the US President Donald Trump, had raised questions about the sale process earlier this week in a letter alleging favourable treatment to Netflix.

— Stock market reacts to the deal

The market's early reaction reflects investor caution, with Netflix shares dipping nearly 3% in premarket trading after announcing the deal.

Warner Bros Discovery shares held steady, closing at $24.5 on Thursday, giving it a market value of $61 billion.

The rival bidder, Paramount, was also down 2.2%. Comcast, the third suitor, was trading little changed.

— Expect intense antitrust scrutiny

Analysts say Netflix is motivated by a strategy to secure long-term rights to hit shows and films, reducing its reliance on external studios as it expands into gaming and looks for new growth opportunities after the success of its password-sharing crackdown.

But the deal is expected to face strong antitrust scrutiny in Europe and the United States as the deal would give the world's biggest streaming service complete ownership of a rival that is home to HBO Max and boasts nearly 130 million streaming subscribers.

— Cash-and-stock deal

Under the agreement, each Warner Bros Discovery shareholder will receive $23.25 in cash and about $4.50 in Netflix stock per share, valuing the company at $27.75 a share, or about $72 billion in equity and $82.7 billion, including debt.

The deal is expected to close once Warner Bros Discovery spins off its global networks unit, Discovery Global, into a separately listed company, a process now slated for completion in the third quarter of 2026.

Netflix expects the acquisition to deliver at least $2 billion to $3 billion in annual cost savings by the third year, after the deal closes.