Netflix is on a mission to make its acquisition of Warner Bros Discovery more “palatable” to shareholders by switching to an all-cash offer. The $83 billion deal is being retooled to provide immediate liquidity, a move aimed at speeding up the process and defeating a hostile bid from Paramount Skydance.
The original deal, agreed to in December, involved a mix of cash and stock. However, with Paramount pressing a $108.4 billion hostile takeover attempt, Netflix needs to offer more certainty. Paramount’s bid is debt-heavy and has been rejected by WBD’s board, but the company is still trying to replace the directors to get its way.
Netflix’s new plan offers cash for the studio and streaming businesses, including HBO and Warner Bros Pictures. WBD’s linear networks, like CNN and Discovery, are not included and will be spun off. This structure simplifies the deal and offers a clear exit for shareholders.
The proposed acquisition has faced backlash from politicians and industry figures who fear a monopoly. Critics argue that the combined company would control nearly half of the streaming market, a level of dominance that could be bad for the industry.
Despite these concerns, the market reaction has been positive. WBD shares closed 1.6% higher on Tuesday, indicating that investors like the sound of an all-cash deal. For Netflix, the move is about securing the content it needs to stay on top, regardless of the cost.