Netflix, Warner Bros. Discovery revise merger deal to all-cash structure

Netflix and Warner Bros. Discovery (WBD), have amended their merger agreement to convert the transaction into an all-cash deal, a move the companies say simplifies the structure, increases certainty for shareholders and accelerates the timeline to a stockholder vote.

Under the revised terms, Netflix will acquire Warner Bros. Discovery for $27.75 per share in cash, unchanged from the valuation in the original agreement. In addition, Warner Bros. Discovery shareholders will receive shares in Discovery Global following its planned separation from the company. The acquisition will be financed through a combination of cash on hand, existing credit facilities and committed financing.

Executives said the amended structure removes market-related volatility from the consideration and is expected to allow Warner Bros. Discovery shareholders to vote on the deal by April 2026. To support the accelerated timetable, the company has filed a preliminary proxy statement with the U.S. Securities and Exchange Commission.

David Zaslav, President and CEO, Warner Bros. Discovery: "Today's revised merger agreement brings us even closer to combining two of the greatest storytelling companies in the world and with it even more people enjoying the entertainment they love to watch the most. By coming together with Netflix, we will combine the stories Warner Bros. has told that have captured the world's attention for more than a century and ensure audiences continue to enjoy them for generations to come."

Ted Sarandos, co-CEO, Netflix: "The WBD Board continues to support and unanimously recommend our transaction, and we are confident that it will deliver the best outcome for stockholders, consumers, creators and the broader entertainment community. Our revised all-cash agreement will enable an expedited timeline to a stockholder vote and provide greater financial certainty at $27.75 per share in cash, plus the value from the planned separation of Discovery Global. Together, Netflix and Warner Bros. will deliver broader choice and greater value to audiences worldwide, enhancing access to world-class television and film both at home and in theaters. The acquisition will also significantly expand U.S. production capacity and investment in original programming, driving job creation and long-term industry growth."

As previously announced, Warner Bros. Discovery plans to separate Warner Bros. and Discovery Global into two publicly traded companies. The separation is expected to be completed within six to nine months, ahead of the closing of the Netflix transaction.

The deal remains subject to regulatory approvals, the completion of the Discovery Global separation, approval by Warner Bros. Discovery shareholders and other customary closing conditions. The companies have submitted filings under the Hart-Scott-Rodino Act and are engaging with competition authorities in the United States and Europe. The financing structure is not subject to review by the Committee on Foreign Investment in the United States.

The companies continue to expect the transaction to close within 12 to 18 months of the original merger agreement.

www.netflix.com
www.warnerbros.com

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