Media

Netflix pulls out, now Warner Bros Discovery goes straight for Paramount Skydance

The streaming giant, which had four days to relaunch on Paramount's proposal deemed 'superior' by Wbd: 'The deal is no longer financially attractive'. President Trump's closeness to (and preference for) the Ellison family, owners of Paramount, weighed in

by Andrea Biondi

26 February 2026

3' min read

Translated by AI

Versione italiana

3' min read

Translated by AI

Versione italiana

In the end, the twist has the dry sound of a slamming door. Netflix exits the negotiating room and, in doing so, clears the corridor: Paramount Skydance remains practically alone in its bid for Warner Bros Discovery, with an offer that the board of the group led by David Zaslav has already branded a "superior proposal". And the market, as is often the case, does not make philosophy: it makes percentages. Netflix stock jumping in after hours, investors happy to see it give up one of the heaviest - and riskiest - dossiers in recent media history.

The surrender is written in a statement that has the air of a lesson in financial discipline recited in a firm voice: 'The deal we negotiated would have created value for shareholders with a clear path to regulatory approval. However, we have always been disciplined and, at the asking price to match Paramount Skydance's last offer, the deal is no longer financially attractive, so we refuse to match Paramount Skydance's offer'.

The message is clear: in order to break even on that $31 a share put on the table by Paramount-Skydance, Netflix would have had to go further than it had set itself. And it doesn't. Not now. Not with the shadow of antitrust looming over a deal that, just imagining it, would have made law offices and regulators on both sides of the Atlantic tremble.

The paradox is that the waiver comes as Netflix co-CEO Ted Sarandos was in Washington pushing on the Trump administration, trying to convince officials and decision-makers that the marriage with Warner was clean, digestible, approvable. Four working days were there, written on the calendar: time until Wednesday 4 March, 23:59 ET to raise. Instead, the tear is immediate: less than two hours after Warner's move, Netflix closes the notebook.

The mood recorded in the palaces of power is not insignificant in this respect. The proximity of the Ellison family to the president of the United States has at times overflowed into a kind of support - even if denied on several occasions - but just as undebatable will certainly have been, most recently, the stance taken by the tenant of the White House who pointed the finger at Susan Rice, Obama's former advisor and board member of Netflix.

Beside the political data, behind the scenes the numbers tell a real battle. Netflix had signed a $27.75 per share deal in December, a total valuation close to $83 billion (including debt). Then Paramount Skydance upped the ante: not a piece, but the whole of Wbd, with Hbo, CNN, the cable networks and the backbone of a studio that in Hollywood weighs like a surname. The latest offer, submitted on 24 February, takes the valuation to around 111 billion. Not only that: more guarantees, more penalties, more insurance.

In fact, the Paramount-Skydance proposal is a package with reinforced edges: a $0.25 per share fee for each quarter of delay beyond the end of September; a $7 billion regulatory penalty if the deal crashes with the authorities; and even a commitment to cover the $2.8 billion termination fee Warner would have to pay Netflix to break the December deal.

Netflix tries to save face without waging war: it thanks, lists names, reiterates the company's 'healthy' profile, and returns to speak the language it is most comfortable with: catalogue, organic growth, investments, buybacks. "This year we will invest around $20 billion in quality films and series and expand our entertainment offering. We will also resume our share buyback programme."

And Paramount-Skydance? For David Ellison - 43 years old, already strengthened by the merger of his Skydance with Paramount that gave him studios, streaming and networks like Cbs and Mtv - this is the wide road. In recent months, the campaign has been 'multiple': private offer, tender offer, threat of proxy fight, pressure on regulators and politicians, trips to Washington. And above all a detail that, in Hollywood, sounds like a script guarantee: personal guarantees on over 40 billion in equity from his father Larry Ellison, co-founder of Oracle, one of the richest men in the world.

Now the most delicate step remains: approvals. Paramount argued that its design would be better seen by regulators than a deal with Netflix; the Los Gatos giant retorted by accusing its opponent of 'misrepresenting the regulatory review process'. But in the meantime, the scene has changed: the auction, which seemed destined to escalate again, has suddenly deflated. And now Paramount Skydance smells the finish line.

Andrea BiondiVicecaposervizio
Luogo: Milano
Lingue parlate: Italiano, Inglese, Francese
Argomenti: Finanza, Media, Telecomunicazioni, Economia dell'entertainment, Innovazione
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