Netflix (NYSE:WBD) and Warner Bros. Discovery (NYSE:WBD) amended their definitive merger agreement on Tuesday, pivoting to an all-cash transaction to provide shareholders with greater price protection and accelerate the closing timeline.
The revised deal maintains the previously announced valuation of $27.75 per WBD share, but eliminates the stock component that had exposed investors to Netflix's market volatility.
The amendment comes as Netflix seeks to solidify its $83 billion takeover in the face of a hostile $30-per-share all-cash counteroffer from Paramount Skydance.
By stripping away the complex stock-collar mechanics, Netflix is betting that "value certainty" will win over WBD stockholders who are also set to receive equity in a planned spin-off of WBD's linear networks, to be named Discovery Global.
To fund the pivot, Netflix has significantly increased its financial firepower.
According to regulatory filings, the streaming giant boosted its bridge financing commitments by $8.2 billion, bringing the total to $42.2 billion in senior unsecured bridge term loans.
This is supplemented by Netflix’s existing cash on hand and a $5 billion revolving credit facility.
The shift to an all-cash structure simplifies the SEC registration process, allowing WBD to file its preliminary proxy statement immediately.
The companies now expect a stockholder vote by April 2026, months ahead of the original schedule.