Netflix Will Acquire Warner Bros. In New Deal Following Discovery Global Separation
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A definitive agreement has been made between Netflix and Warner Bros. Discovery. After Discovery Group separates from Warner Bros., Netflix will acquire the latter of the two companies. This will mean Netflix will acquire the franchises, studios, and streaming services that WBD holds, though Netflix has said they will keep operations at the company continuing as they currently are.
The deal is valued at an estimated enterprise value of $82.7 billion (equity value of $72 billion), with it expected to close after the separation of Warner Bros. and Discovery Group. While approved unanimously by the Boards of Directors of both Netflix and WBD, the transaction will be subject to required regulatory approvals and other closing conditions before it can close. Such is expected to take 12-18 months.
Netflix has stated that it will maintain theatrical releases for franchises under Warner Bros., with the content of HBO and HBO Max crossing over to Netflix. By doing so, they hope to increase the number of subscribers to the service, driving more engagement and operating income. The studios of Warner Bros. will help Netflix expand its production capacity, with the company hoping to strengthen the entertainment industry with more jobs and a greater value for talent.
The co-CEOs of Netflix and WBD, David Zaslav, had something to say about the deal. Ted Sarandos said, “Our mission has always been to entertain the world. By combining Warner Bros.’ incredible library of shows and movies – from timeless classics like Casablanca and Citizen Kane to modern favourites like Harry Potter and Friends – with our culture-defining titles like Stranger Things, KPop Demon Hunters, and Squid Game, we’ll be able to do that even better. Together, we can give audiences more of what they love and help define the next century of storytelling.”
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Greg Peters added to that with, “This acquisition will improve our offering and accelerate our business for decades to come. Warner Bros. has helped define entertainment for more than a century and continues to do so with phenomenal creative executives and production capabilities. With our global reach and proven business model, we can introduce a broader audience to the worlds they create – giving our members more options, attracting more fans to our best-in-class streaming service, strengthening the entire entertainment industry, and creating more value for shareholders.”
David Zaslav stated, “Today’s announcement combines two of the greatest storytelling companies in the world to bring even more people the entertainment they love to watch the most. For more than a century, Warner Bros. has thrilled audiences, captured the world’s attention, and shaped our culture. By coming together with Netflix, we will ensure people everywhere will continue to enjoy the world’s most resonant stories for generations to come."
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Source: Netflix
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