Netflix drops Warner Bros. Discovery deal as Paramount wins bidding war
| Date | Type | Companies Involved | Size |
|---|---|---|---|
| Feb 27, 2026 | acquisition | Netflix Warner Bros. | Not disclosed |
- Netflix has said it will not up its offer after Paramount issued a "superior proposal".
- Any deal remains subject to regulatory approval.
Netflix has effectively dropped its mega $82.7 billion deal for Warner Bros. Discovery after refusing to counter Paramount Skydance’s “superior proposal”.
The two entertainment giants have been in a bidding war in recent months, with Paramount’s latest bid worth $31 per share in cash. After Warner notified Netflix of the deal and asked for a counter offer, Netflix declined.
The streaming firm’s co-CEOs Ted Sarandos and Greg Peters said the deal was no longer financially attractive and said it would not match Paramount’s bid, effectively pulling the company out of the race. It paves the way for the acquisition of Warner by Paramount, subject to regulatory approval.
“We believe we would have been strong stewards of Warner Bros.' iconic brands, and that our deal would have strengthened the entertainment industry and preserved and created more production jobs in the US,” read a statement from Sarandos and Peters.
“But this transaction was always a 'nice to have' at the right price, not a 'must have' at any price.”
Paramount will pay the $2.8 billion termination fee to end Netflix’s existing agreement. Bank of America Merrill Lynch, Citi and Apollo will provide a $57.5 billion debt commitment, while the Ellison Trust is providing a $45.7 billion equity commitment.
Future of Warner Bros. Games
Warner Bros. Discovery has a games division that includes studios such as Rocksteady, NetherRealm, TT Games, Avalanche Software and WB Games Montreal. It also includes famous IP such as The Wizard of Oz, Harry Potter, Game of Thrones and DC.
It’s not clear what the fate of the company’s games division will be post-acquisition. Netflix co-CEO, president and director Gregory Peters previously said the streaming firm didn’t attribute any value to the division in its $82.7bn bid.
“They’ve got great studios and great folks working there. So we think that there’s definitely an opportunity there. But just to be clear, we haven’t built that into our deal model,” he said.
Mobile games record
Top revenue-generating mobile games from the Warner Bros. stable include titles such as Game of Thrones Conquest, which accumulated an estimated $960 million, according to estimates from market intelligence platform AppMagic.
Meanwhile, in partnership with NetEase, Harry Potter: Magic Awakened garnered an estimated $465m across the App Store and Google Play - figures that do not include alternative Android stores.
Top games to break $100m include Mortal Kombat, Injustice 2 and Injustice: Gods Among Us. Other notable games are Heads Up! and DC Legends: Fight Super Heroes.
More recent titles from Warner Bros. have struggled to gain as much traction. DC Worlds Collide launched earlier this year, picking up $9.6m. A new 4x strategy game, Game of Thrones: Dragonfire, is currently in soft launch.
As well as developing its own games for mobile, Warner Bros. has also licensed out its IP to major studios. Titles that have made hundreds of millions of dollars include Zynga’s Harry Potter: Puzzles & Spells and Game of Thrones Slots Casino, Jam City’s Harry Potter: Hogwarts Mystery, and Scopely’s Looney Tunes: World of Mayhem.
Companies
