Netflix and Paramount drew widespread media scrutiny when they entered the bidding war to acquire Warner Bros. Discovery‘s assets. The war recently concluded when the former stepped down and refused to match or outbid Paramount’s latest and final bid, which WB found more appealing than Netflix’s offer, resulting in Paramount’s victory.
The streaming giant’s CEO, Ted Sarandos, has now explained why it backed out of the war and didn’t counter Paramount’s superior proposal.
Ted Sarandos on why Netflix backed out after Paramount’s offer for WBD
In a recent interview, Ted Sarandos revealed that Netflix had prepared for the outcome of the bidding war: Paramount presenting a superior offer to Warner Bros. and securing victory, and planned their exit.
“We knew right away, when we got the notice on Thursday that they had a superior offer and the details of that deal,” he told Bloomberg. “We knew exactly what we were gonna do.”
Sarandos also revealed why they didn’t counter Paramount’s bid by presenting a superior offer. “We had a very tight range that we’d be willing to pay and made that offer back when we closed this deal,” he explained.
The media executive added that they didn’t heavily alter their initial deal aside from changing the cash and stock transaction to a fully cash transaction, which he stressed was to quicken the deal’s progress. He further stated, ” I’m happy where we got in and happy where we got out.”
He also shared that Netflix had planned scenarios, due to which they didn’t have to return to the board and figure out their next move. “There was a lot of uncertainty in their financing,” Sarandos emphasized. “What would they be willing to do on price? Would they close all those other issues, but not raise the price?”
He continued, “Once they did what I probably didn’t expect, which was the personal guarantee for a $111 billion deal — it’s pretty unprecedented — that was clear to us. They had taken all the other issues off the table and then they additionally raised the price.”
Sarandos also noted that while Paramount clearly stated their offer to Warner Bros. wasn’t “last and final,” Netflix’s deal on December 5, 2025, was. “We presented it as last and final. It was,” he added.
Moreover, he ruled out the possibility of Netflix eyeing another studio in the wake of losing WB Discovery to Paramount. Sarandos clarified that he and the streaming giant were “builders, not buyers” and that they would use the $2.8 billion they had to continue investing in their business.
Originally reported by Abdul Azim Naushad on ComingSoon.
