Netflix mulls acquiring Warner Bros Discovery; company hires bank, gains financial data access — Key things to know

Netflix has hired an investment bank as it actively explores a bid to acquire Warner Bros Discovery's studio and streaming business, according to Reuters quoting three people with the knowledge about the matter.

The streaming giant has retained Moelis & Co as its financial advisor so that it can evaluate a prospective offer, two of the persons quoted by Reuters said.

Moelis & Co is the investment bank that advised Skydance Media during its successful acquisition of Paramount Global.

Netflix has also gained access access to the data room, which the company needs to make the bid as it contains the financial details, two persons told Reuters.

Netflix, Moelis or Warner Bros Discovery have not issued a statement regarding the potential deal.

A successful deal to own Warner Bros' studio business would mean Netflix will be able to gain control over some of the most popular and successful stories and characters across the world, such as the Harry Potter and DC Comics franchises.

Many of Netflix's biggest hits, including original series like "Running Point," "You" and "Maid has been produced by Warner Bros' prolific television studio. HBO and its companion streaming service would add more prestige dramas, and subscribers to this collection, Reuters estimates.

Currently in India, JioStar is the exclusive streaming platform for HBO, Max Original, and Warner Bros. content after Jio inked a deal with Warner Bros in April 2023.

What is Netflix's growth plan?

Last week, Netflix CEO Ted Sarandos told investors that the company does look at acquisitions based on certain criteria even though its policy has inclined more towards “builders than buyers.” The company evaluates these opportunities based on matters like the size of the offer and whether it would help strengthen the company's entertainment value.

The Netflix CEO further said that the streaming giant would not be interested in buying Warner Bros Discovery's cable television networks, under which legacy media channels like CNN, TNT, Food Network and Animal Planet fall.

“We've been very clear in the past that we have no interest in owning legacy media networks… There is no change there,” Sarandos told investors in a video announcing Netflix's Q3 results.

Warner Bros evaluating options

Warner Bros Discovery announced last week that it would begin evaluating options, after receiving three unsolicited offers from Paramount Skydance to acquire the entire company.

The company said its board would consider if it wants to move forward with its planned split.

This move would separate the Warner Bros film and television studios, HBO and the companion HBO Max streaming service from its television business, or pursue a sale of all or parts of the company.