Media giant Warner Bros. Discovery has officially signed a merger agreement with Paramount Skydance, marking one of the biggest events in Hollywood history. The decision was made after a long struggle for assets, in which streaming service Netflix also participated, but the latter refused to outbid the competitors' final price. This was reported by Reuters, writes UNN.
Details
The agreement was signed on Friday morning after Netflix did not offer an amount equivalent to $31 per share, stopping at $27.75.
Netflix had the legal right to double PSKY's offer. As you all know, they ultimately decided not to. This led to the signing of the agreement with PSKY this morning. So, that's where it all ended.
The market reacted to the news with a sharp rise in Paramount shares by 24% and Netflix by 13%, as investors approved the end of the exhausting race.
Antitrust risks and strategic advantages of the merger
Despite expectations that the EU antitrust committee would easily approve the deal, the merger has already attracted the attention of California Attorney General Rob Bonta, who announced the start of an investigation.
The merger project includes about $29 billion in debt, but it gives Paramount access to iconic Warner Bros. franchises such as "The Matrix" and "Fantastic Beasts." The new structure will gain a significant market share, which will allow it to compete more effectively with global streaming leaders and optimize content creation costs.