David Zaslav of WBD Sends Best Wishes to Netflix and Excitedly Looks Forward to Collaborating with Paramount

In a surprising turn of events, Warner Bros. Discovery (WBD) has shifted its focus from Netflix to Paramount just a week after announcing a potential deal with the streaming giant. The abrupt decision has left Netflix on the sidelines as WBD explores new partnership opportunities.

In a statement, WBD CEO David Zaslav expressed appreciation for Netflix, stating, “Netflix is a great company and throughout this process Ted, Greg, Spence, and everyone there have been extraordinary partners to us. We wish them well in the future.” This comment came shortly after WBD announced its intention to pursue Paramount’s “company superior offer,” which Netflix reportedly declined to counter.

Zaslav emphasized the potential benefits of the merger, saying, “Once our Board votes to adopt the Paramount merger agreement, it will create tremendous value for our shareholders. We are excited about the potential of a combined Paramount Skydance and Warner Bros. Discovery and can’t wait to get started working together telling the stories that move the world.”

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Ted Sarandos and Greg Peters serve as co-CEOs of Netflix, while Spencer Neumann holds the position of CFO.

Samuel A. Di Piazza, Jr., chair of the Warner Bros. Discovery board, expressed pride in the process leading to this point, stating, “I’m extremely proud of the rigorous process this Board has run over the past five and a half months that has led us to the cusp of combining these two storied companies and the excitement it will bring to audiences for many years to come.”

The landscape remains challenging for media companies. WBD had initially agreed to a deal with Netflix on December 5, pricing its streaming and studio assets at $27.75 per share in cash. However, persistent offers from Paramount, particularly a sweetened recent proposal, led WBD to reconsider its options and move towards what has been labeled the superior offer.

Netflix was given four business days to match the offer, but ultimately decided to withdraw from negotiations.

In a small consolation, Netflix shares experienced an uptick following the news, as investors appeared more favorable towards the company’s stability over the complexities of merging assets. Additionally, Netflix will receive a $2.8 billion breakup fee from WBD, funded by Paramount.

While Netflix steps back, the developments have prompted a rival studio to enhance its financial commitment, marking what may be the largest leveraged buyout in industry history.