Yahoo Finance·2025-12-05 16:45Core Viewpoint - Netflix has successfully acquired Warner Bros. Discovery's premium assets, including Warner Bros. film and TV studios and HBO Max, in a deal valued at $82.7 billion, equating to $27.75 per share [2][4]. Group 1: Acquisition Details - The acquisition includes a combination of $23.25 per share in cash and $4.50 per share in Netflix stock, allowing Warner Bros. to divest its cable assets while addressing its $40 billion debt [4][5]. - The deal positions Netflix to gain ownership of valuable intellectual properties such as Harry Potter, Game of Thrones, and DC Comics, while also acquiring HBO Max's 100 million subscribers [5][6]. Group 2: Market Context - The acquisition comes amid a competitive bidding environment involving Paramount Skydance and Comcast, with Netflix focusing solely on the studios and streaming service rather than cable assets [3][5]. - Netflix's subscriber base is expected to grow significantly, combining HBO Max's 100 million subscribers with its existing 300 million accounts, creating a substantial competitive advantage [6][8]. Group 3: Financial Implications - Following the acquisition, Netflix's debt is projected to increase from $14.5 billion to over $90 billion, resulting in a debt-to-equity ratio that could exceed 2.5 [8]. - The integration of Warner Bros. assets poses significant risks, as historical data indicates that 70% to 90% of mega-mergers fail due to cultural clashes and communication issues [8].