Netflix ‘Highly Confident’ It Will Receive Regulatory Approval of $82.7 Billion Warner Bros. Deal: ‘We Are Running Full Speed’

Netflix says it is “highly confident” that it will receive and “running full speed” toward regulatory approval for its acquisition of Warner Bros. streaming and studio assets.

“This deal is pro consumer, pro innovation, pro worker, it’s pro creator, it’s pro growth, and our plans here are to work really closely with all the appropriate governments and regulators, but we’re really confident that we’re going to to get all the necessary approvals that we need,” Netflix co-CEO Ted Sarandos told analysts on Friday. “These two businesses are complementary, and they’re also loved businesses, which is really fantastic.”

When asked if they are concerned about another bid coming in and having to raise their offer, Sarandos added: “We are running full speed towards regulatory approval. We’re focused on getting the deal done. We’re not going to speculate on what comes after that. We’re full steam ahead.”

The cash and stock deal, which is expected to close in the next 12 to 18 months, values Warner Bros. Discovery at $27.75 per share, implying a total equity value of approximately $72 billion and an enterprise value of approximately $82.7 billion.

Under the terms of the deal, each WBD shareholder will receive $23.25 in cash and $4.50 in shares of Netflix common stock for each share of WBD common stock outstanding at the closing of the transaction.

The stock component is subject to a collar under which WBD shareholders will receive Netflix stock valued at $4.50 per share, provided the 15-day volume weighted average price (“VWAP”) of Netflix’s stock price falls between $97.91 and $119.67. If the VWAP is below $97.91, WBD shareholders will receive 0.0460 Netflix shares for each WBD share. If the VWAP is above $119.67, WBD shareholders will receive 0.0376 Netflix shares for each WBD share.

The deal comes after WBD launched a strategic review of alternatives in October, citing “unsolicited interest” from multiple parties for all or part of its business.

In addition to continuing on with its planned split into Warner Bros. and Discovery Global, the company’s board considered separate transactions for the two companies or a deal for the entire combined company. WBD also considered an alternative separation structure that would enable a merger of Warner Bros. and spinoff of Discovery Global to its shareholders.

Netflix, Paramount and Comcast would enter a contentious bidding war, with Paramount submitting multiple bids for the entire company, while Netflix and Comcast submitted bids for the studio & streaming business. The bidding went for three rounds before Netflix and WBD entered exclusive talks.

“If we sound a little tired, it’s because we are,” Sarandos said. “We have found this to be an incredibly rigorous and competitive process.”

Warner Bros. Discovery’s split of its studios and streaming and global linear networks business will be completed in the third quarter of 2026, prior to the closing of the Netflix deal. Discovery Global will be a publicly-traded company that houses CNN, TNT Sports, in the U.S., and Discovery, free-to-air channels across Europe, and digital products such as Discovery+ and Bleacher Report. 

Shares of Netflix fell 4% in pre-market trading following the deal announcement, while WBD shares jumped 4%.  

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