Proposed acquisition of Warner Bros.

https://www.thewrap.com/netflix-wins-the-warner-bros-discovery-bidding-war-enters-exclusive-deal-talks/

It's also been reported in Bloomberg, The Wall Street Journal, Deadline, The Hollywood Reporter and Variety.

Warner Bros. Discovery is moving forward with exclusive deal talks with Netflix, TheWrap has learned. WBD has selected Netflix after the streaming giant offered $30 a share for the studio and streaming assets, according to two people familiar with the deal talks. The deal also includes a $5 billion break-up fee to match the terms that Paramount added with its bid.

While its unclear what the makeup of the new bid looks like, the prior bid was a mix of mostly cash and stock.

Netflix securing a win over rival suitors Paramount and Comcast represents a stunning turnaround from just two months ago, when co-CEO Greg Peters shared big media mergers as not having an “amazing track record,” and Paramount buying WBD seemed like a foregone conclusion. Fast forward to today, and Netflix has won a furious M&A bake-off after three rounds of bids.

Representatives for Netflix and WBD weren’t immediately available for comment.

While exclusive talks clears the road for Netflix to acquire the Warner Bros. studios, HBO Max and a treasure trove of IP assets like “Harry Potter” and the DC Universe. Netflix, which once aspired to be HBO when first embarking on original content, is on a course to becoming its owner. Obtaining such assets could dramatically reshape the entertainment landscape and give Netflix even more power over Hollywood — concerns the streamer will have to assuage.

The willingness to include the unusually large breakup fee was likely critical with questions arising on how Netflix will get a deal with Warner Bros. through regulatory approval. A deal would face stiff antitrust scrutiny and opposition from the U.S. Department of Justice, New York Post’s Charles Gasparino reported on Tuesday.

A representative for the Department Justice declined to comment on the report.

In a Nov. 13 letter to U.S. Attorney General Pam Bondi, FTC Chairman Andrew Ferguson and Department of Justice antitrust division assistant attorney general Gail Slater, Republican Rep. Darrell Issa warned that a Netflix bid would raise antitrust concerns that could harm consumers and Hollywood alike. He noted that consolidation between the two companies would “diminish incentives to produce new content and major theatrical releases,” which could “undermine opportunities for the full range of industry professionals both in front of and behind the camera.”

The third round of bids came a day after Paramount had issued a letter to Warner Bros. Discovery CEO David Zaslav claiming the bid process had been “tainted by management conflict.” This followed an earlier letter this week from Paramount arguing that a deal would not get regulatory clearance.

Paramount, which seem intent on buying all of WBD, could take its own offer to shareholders. And even if it doesn’t match Netflix’s offer, it could lean on the selling point that it could close a deal faster than the expected longer grind that the streaming giant would undergo.

Paramount has already been through this process with the Trump administration before closing its merger with Skydance this summer. In September, it hired Makan Delrahim, former assistant attorney general of the Justice Department’s antitrust division during Trump’s first term, as its chief legal officer.

Netflix first tapped the investment bank Moelis & Co. to explore a potential bid for Warner Bros. Discovery’s streaming and studio assets in October. The company went on to submit three rounds of bids to WBD’s board alongside Paramount and Comcast. The former previously submitted multiple bids for the entire company, while Comcast submitted bids for the streaming & studio business.

Title says it all. I’m not familiar with the media landscape, but it seems like Netflix is purchasing all the IP available.