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Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.<\/span><\/p>\n Netflix has agreed an $83bn takeover of Warner Bros Discovery, handing it control of one of Hollywood\u2019s most celebrated studios and creating a global entertainment powerhouse. <\/p>\n The deal will transform Netflix into the dominant player in Hollywood, capping its relentlessly disruptive rise since it was founded as a DVD rental company almost three decades ago.<\/p>\n Under the deal, Netflix will secure a coveted library of content including the Harry Potter and Batman franchises, WBD\u2019s streaming business and the premium programming of HBO.<\/p>\n WBD will continue with the planned spin-off of its cable television networks, including CNN, Discovery and Turner, into a separate company before the studios and streaming businesses are sold to Netflix.<\/p>\n Netflix saw off competition from Comcast and Paramount, which had been seen by many as the frontrunner in a bidding war that kicked off in October and was overseen by WBD boss David Zaslav.<\/p>\n Netflix co-chief executive Ted Sarandos told analysts that while \u201cwe have been known to be builders, not buyers\u201d, the auction of WBD presented a \u201crare opportunity\u201d.<\/p>\n Recommended<\/p>\n \u201cIn a world where people have so many choices, more choices than ever how to spend their time, we can\u2019t stand still,\u201d said Sarandos, who runs the company with Greg Peters.<\/p>\n According to the terms of the deal, WBD investors will receive $23.3 in cash and $4.5 worth of Netflix shares for each WBD share. The transaction gives WBD an enterprise value, including debt, of $82.7bn, while valuing the group\u2019s equity at $72bn.<\/p>\n Netflix\u2019s triumph in the contest for WBD, whose eponymous studio was founded more than a century ago at the start of a golden era for Hollywood, will reverberate across an industry that the company has already done much to reshape.<\/p>\n Peter Supino, analyst at Wolfe Research, said its pursuit was driven by its need for content to attract subscribers. New productions accounted for under 5 per cent of the total content on the platform last year but generated more than a fifth of what was watched, he said. <\/p>\n \u201cThe importance of new content for Netflix\u2019s engagement underpins why Warner Bros\u2019 production infrastructure and IP should appeal,\u201d he added.<\/p>\n The combination of Netflix and WBD is expected to draw scrutiny from regulators in the US and Europe, where both companies have extensive operations. <\/p>\n People close to the deal said they were confident any hurdles could be overcome, pointing to the fierce competition for audiences not just from rival streamers but also platforms such as YouTube.<\/p>\n Zaslav, one of the most powerful figures in the entertainment industry, is likely to stay as the head of the new WBD studios, whose operations will be kept separate from those of Netflix, according to people close to the deal.<\/p>\n Netflix will secure the Batman franchise<\/span> \u00a9 Jonathan Olley\/Warner Bros.<\/span><\/p>\n Netflix, which releases its own content directly on to its streaming service, has also promised to keep cinema releases for films made by Warner Bros.<\/p>\n The deal, which was approved by the boards of Netflix and WBD, will need the backing of WBD shareholders. It is expected to close in 12 to 18 months, the companies said. <\/p>\n WBD shares climbed 3 per cent to $25.37 on Friday. Shares in Netflix, which has a market value of $426bn, were volatile on Friday, trading down 2.8 per cent. <\/p>\n The group, which has promised to pay WBD a termination fee of $5.8bn in the event the deal collapses, said it also expected to generate at least $2bn to $3bn of annual cost savings by the third year of its ownership.<\/p>\n Zaslav said: \u201cBy coming together with Netflix, we will ensure people everywhere will continue to enjoy the world\u2019s most resonant stories for generations to come.\u201d<\/p>\n The agreement between Netflix and WBD is a significant blow to Paramount, which is led by David Ellison and backed by Larry Ellison, his father and the billionaire co-founder of Oracle. <\/p>\n Many analysts had thought Paramount was in pole position to emerge as the winner given its financial firepower and its links to the Trump administration.<\/p>\n","protected":false},"excerpt":{"rendered":" Unlock the Editor\u2019s Digest for free Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter. Netflix has agreed an $83bn takeover of Warner Bros Discovery, handing it control of one of Hollywood\u2019s most celebrated studios and creating a global entertainment powerhouse. The deal will transform Netflix into the dominant player<\/p>\n","protected":false},"author":1,"featured_media":36083,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[20212,2479,2036,2037,274,3670,2035],"class_list":{"0":"post-36082","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-83bn","9":"tag-agrees","10":"tag-bros","11":"tag-discovery","12":"tag-netflix","13":"tag-takeover","14":"tag-warner"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/36082","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=36082"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/36082\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/36083"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=36082"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=36082"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=36082"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}