Netflix has agreed to buy the film and streaming businesses of Warner Bros Discovery for $72bn (\u00a354bn) in a major Hollywood deal.<\/p>\n
The streaming giant emerged as the top bidder for Warner Bros ahead of rivals Comcast and Paramount Skydance after a drawn-out battle.<\/p>\n
Warner Bros owns franchises including Harry Potter and Game of Thrones, and the streaming service HBO Max.<\/p>\n
The takeover is set to lead to a radical reshaping of the US film and media industry, but analysts have warned that it could face resistance from competition authorities.<\/p>\n
Netflix co-chief executive Ted Sarandos said that by combining the library of Warner Bros shows and movies such as Casablanca, with the streaming platform\u2019s series such as Friends, \u201cwe can give audiences more of what they love and help define the next century of storytelling\u201d.<\/p>\n
\u201cWarner Bros have defined the last century of entertainment, and together we can define the next one,\u201d he said.<\/p>\n
Labelling it a \u201cbig day\u201d for the companies, Mr Sarandos acknowledged the acquisition may have surprised some shareholders but it was a \u201crare opportunity\u201d to set Netflix up for success \u201cfor decades to come\u201d.<\/p>\n
David Zaslav, president and chief executive of Warner Bros, added the agreement would combine \u201ctwo of the greatest storytelling companies in the world\u201d.<\/p>\n
\u201cBy coming together with Netflix, we will ensure people everywhere will continue to enjoy the world\u2019s most resonant stories for generations to come,\u201d he said.<\/p>\n
The cash and stock deal is worth $27.75 per Warner Bros share, with a total enterprise value \u2013 which includes the company\u2019s debts and the value of its shares -of about $82.7bn. The equity value, or cash price, is $72bn.<\/p>\n
Both boards of directors from each company unanimously approved the deal.<\/p>\n
The acquisition of Warner Bros is expected to enable Netflix to expand its studio production capacity and increase its investment in original content.<\/p>\n
Netflix will complete the takeover after Warner Bros finalises its previously announced plans to separate its streaming and studios division from its global networks division into two publicly traded companies next year.<\/p>\n
Its global networks division includes its cable channels such as CNN, as well as its sports brands and free-to-air channels in Europe.<\/p>\n
Paolo Pescatore, founder and technology media and telecom analyst at PP Foresight, said the sale was \u201ca huge statement of intent and underlines Netflix aspirations to be a global leader in the new world order of streaming\u201d.<\/p>\n
But he warned while the \u201csurprising move\u201d made sense for Warner Bros, it would \u201cprovide a headache for Netflix\u201d.<\/p>\n
\u201cThis is uncharted waters and previous big media acquisitions have been poorly executed. If and once approved, Netflix will need to have a razor sharp focus on integration and execution,\u201d he said.<\/p>\n
While the agreed deal is for part of Warner Bros business, rival Paramount had tabled a bid to buy the whole company, including its cable networks, in October.<\/p>\n
Warner Bros rejected this move before putting itself up for sale.<\/p>\n
Ahead of Friday\u2019s announcement Emma Wall, chief investment strategist at Hargreaves Lansdown, said the US competition regulator was likely to get involved whoever the winner was.<\/p>\n
\u201cThis will create a global mega power in broadcast entertainment which the regulator will want to look at,\u201d she said.<\/p>\n
Tom Harrington, head of television at Enders Analysis, said it was hard to gauge whether the deal would win regulatory approval, but if it went through it would have a massive impact on cinema.<\/p>\n
\u201cWere it to go through it would reorient Hollywood, with a streamer acquiring a business much of which it is existentially the antithesis of \u2013 Netflix has always had some limited use for the cinema but generally its offering undermines it,\u201d he said.<\/p>\n
Mr Harrington said there was likely to be \u201cbig reductions\u201d in television and film output from a merged entity, which would lead to resistance to the move from parts of Hollywood and relevant unions.<\/p>\n
\u201cHBO, the creative jewel, would be terribly exposed within Netflix, although it has survived difficult owners for a lot of its existence,\u201d he said.<\/p>\n
For consumers, Mr Harrington said a merger was likely to lead to higher costs.<\/p>\n
\u201cNetflix would get more expensive and even though HBO Max would be shuttered\/become non-essential, the greater penetration of Netflix households would likely mean an increase in total overall subscription revenues.\u201d<\/p>","protected":false},"excerpt":{"rendered":"
Netflix has agreed to buy the film and streaming businesses of Warner Bros Discovery for $72bn (\u00a354bn) in a major Hollywood deal. The streaming giant emerged as the top bidder for Warner Bros ahead of rivals Comcast and Paramount Skydance after a drawn-out battle. Warner Bros owns franchises including Harry Potter and Game of Thrones, […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-126065","post","type-post","status-publish","format-standard","hentry","category-uncategorized","entry"],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/posts\/126065","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/comments?post=126065"}],"version-history":[{"count":0,"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/posts\/126065\/revisions"}],"wp:attachment":[{"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/media?parent=126065"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/categories?post=126065"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/tags?post=126065"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}