Netflix Drops Warner Bros Bid: Why Ted Sarandos' White House Visit Couldn't Save the $83 Billion Deal

Netflix walked away from an $83 billion (£61.5 billion) deal to buy Warner Bros Discovery on Thursday. The same day, its co-CEO, Ted Sarandos, was at the White House.

That timing? Hard to ignore.

Sarandos Was in Washington, But It Didn't Matter

Hours before Netflix pulled out, Warner Bros Discovery's board labelled Paramount Skydance's $111 billion (£82.3 billion) offer as 'superior'. Netflix had four business days to counter. It didn't bother.

'This transaction was always a "nice to have" at the right price, not a "must have" at any price,' Netflix co-CEOs Sarandos and Greg Peters said in a statement, according to CNBC.

A White House official told CNN that Sarandos met with staff members, not President Donald Trump. Netflix said the visit was arranged two and a half weeks ago. But four days earlier, Trump posted on Truth Social demanding Netflix 'immediately' fire board member Susan Rice, a former Obama and Biden administration official, or pay the consequences.'

Netflix co-CEO Ted Sarandos told the BBC this week: 'This is a business deal, it's not a political deal.'

The numbers suggest otherwise.

The Ellison Family's Bet on Trump

Paramount CEO David Ellison showed up at Trump's State of the Union address on Tuesday. He sat as Senator Lindsey Graham's guest. Graham posted a photo of them giving a thumbs-up.

His father, Larry Ellison, co-founded Oracle. His net worth sits at about $201 billion (£149 billion), according to Bloomberg. He recently made Manalapan, Florida, his primary residence. That's 20 minutes from Mar-a-Lago.

Senate Democrats sent David Ellison a letter this month demanding he preserve all communications with Trump and administration officials about the Warner Bros bid. They accused him of a 'pattern of evasion'.

On the other side, the Department of Justice opened antitrust scrutiny into Netflix's deal. A civil investigative demand dated 20 February asked whether Netflix 'may substantially lessen competition or tend to create a monopoly.' A coalition of 11 Republican attorneys general urged regulators to block the Netflix acquisition, warning it would raise prices and reduce content quality.

Netflix faced regulatory headwinds. Paramount appears confident it won't.

Follow the Money

Paramount offered $31 (£23) per share. Netflix offered $27.75 (£20.59). That gap alone didn't kill the deal.

Look at what Paramount promised on top of its bid: it agreed to pay the $2.8 billion (£2.07 billion) breakup fee Warner Bros would owe Netflix for walking away. It is also committed to a $7 billion (£5.2 billion) reverse termination fee if regulators block the transaction. And if the deal drags past autumn 2026, shareholders get quarterly 'ticking fees' of 25 cents per share.

These aren't normal deal terms. They're insurance policies. Paramount is telling shareholders: we'll get this done, and if we don't, we'll pay you anyway.

That kind of confidence usually comes from somewhere.

What Changes for You

If regulators approve this deal, the combined company would own HBO Max, Paramount+, CBS, CNN, Warner Bros Studios, Paramount Pictures, DC Comics, and the Harry Potter franchise. Fewer competitors usually mean higher prices. Industry groups have already warned about job cuts and less content variety.

Warner Bros Discovery shareholders vote on 20 March. The regulatory review will take months.

Netflix said its business 'is healthy, strong and growing organically.' It doesn't need Warner Bros to survive. But someone will control Batman, Harry Potter, and HBO. And right now, the Ellison family is positioned to own all of it.

That White House visit? It changed nothing. The deal was already lost.