Netflix is accelerating its deal to acquire the Harry Potter universe, switching to an all-cash offer to finalize the purchase of Warner Bros Discovery’s studio assets. The $83 billion deal is being fast-tracked to secure the wizarding franchise and fend off a hostile bid from Paramount Skydance.
Paramount has offered $108.4 billion for WBD, but the bid is hostile and debt-financed. WBD’s board has rejected it, prompting Paramount to try and replace the board. Netflix’s move to an all-cash offer is designed to close the deal before Paramount can succeed.
The acquisition includes the Warner Bros film studio and HBO, home to Harry Potter and other major franchises. WBD’s linear networks, such as CNN and Discovery, are not included in the deal. This targeted approach allows Netflix to acquire the content it wants without the baggage of cable TV.
The deal has raised concerns about market dominance. Politicians warn that a Netflix-WBD merger would control nearly half of the streaming market. This political backlash is a significant obstacle, but Netflix is betting that the allure of Harry Potter will help push the deal through.
The market reaction has been positive. WBD shares rose 1.6% on the news, suggesting that investors are excited about the prospect of Harry Potter on Netflix. For the streaming giant, acquiring the franchise would be a magical addition to its library.
