Hollywood shakeup: Paramount to acquire Warner Bros. in $110B deal

Paramount and Warner Bros. agree to merger

Paramount will acquire Warner Bros. Discovery creating a new Hollywood powerhouse.  

LOS ANGELES - It’s another big shakeup in Hollywood after Paramount announced they entered into a definitive merger agreement with Warner Bros. for $110 billion.

Under the agreement, Paramount will pay $31.00 per share in cash for all outstanding shares of Warner Bros. Discovery. The transaction was unanimously approved by the Boards of Directors of both companies and is expected to close in Q3 2026.

What we know:

The day before the deal became official, Warner Bros.’ board announced that Skydance-owned Paramount’s offer was superior to the agreement it had previously struck with Netflix. The streaming giant said the new price required to buy Warner would make the deal "no longer financially attractive."

PREVIOUS COVERAGE: Netflix declines to raise offer to buy Warner Bros., says deal is ‘no longer financially attractive’

In addition to acquiring Warner Bros. Discovery’s studio and streaming business, Paramount will reportedly acquire all of its networks, film and news assets. CNN would operate under Paramount.

What will happen to the studio lots?

With Paramount taking on billions in debt and equity for the deal to go through, many are wondering what will happen to the two California studio lots, especially at a time when productions are increasingly rare in the state.

The storied Paramount lot on Melrose Avenue in Los Angeles has 30 stages on 65 acres and has hosted productions from "Sunset Boulevard" to "Forrest Gump." Warner Bros. Studios in Burbank sits on a 110-acre lot with 31 soundstages and 11 exterior sets, where productions have included "My Fair Lady," "Gilmore Girls" and "Friends." Both are historic sites. Warner Bros. also operates a large studio in Leavesden, England.

Netflix drops bid for Warner Bros.

Netflix is dropping out of the bid for Warner Bros. Discovery, saying its no longer financially attractive. 

By the numbers:

In December, Netflix reached a deal to acquire a portion of Warner Bros. Discovery’s assets, including its library, movie studio and HBO.

In an unexpected twist, Paramount offered $31 per share compared with Netflix’s offer of $27.75 per share.

"We believe we would have been strong stewards of Warner Bros.’ iconic brands," Netflix co-CEOs Ted Sarandos and Greg Peters said in a previous joint statement. "But this transaction was always a ‘nice to have’ at the right price, not a ‘must have’ at any price."

What's next:

Paramount Skydance Chairman and CEO David Ellison has said he would like to grow the combined slate to more than 30 movies a year, while keeping Paramount and Warner Bros. as stand-alone operations.

Paramount executives have argued that merging with Warner will allow the company to compete with larger rivals, particularly in streaming, and expand its content library for customers.