Paramount agrees to buy Warner Bros. Discovery, pays Netflix $2.8 billion for breakup

Paramount Skydance and Warner Bros. Discovery have officially merged, with Paramount agreeing to pay Netflix a $2.8 billion termination fee for breaking its original deal to buy Warner Bros. The new company will produce at least 30 theatrical films annually and will have a minimum 45-day window for theatrical releases before bringing them to video on demand. The deal, which values Warner Bros. Discovery at $31 per share, is expected to close by Q3 2026. Paramount Skydance will have to pay a daily ticking fee of $0.25 per share per quarter if the deal is delayed, and $7 billion if the deal is terminated for regulatory reasons. The article notes that the deal will face scrutiny from regulators, both at the federal and state levels, with concerns over the close relationship between Paramount CEO David Ellison and his father, Larry Ellison, and the Trump administration. Netflix, which was initially interested in Warner Bros. proper, has ultimately lost the battle for the studio, but may have gained from a competitor potentially overpaying for the company.