American streaming service firm, Netflix, on Friday announced a landmark agreement to acquire Warner Bros. Discovery (WBD) in a cash-and-stock deal valued at about $82.7 billion.

If approved, the deal will hand Netflix control of Warner Bros.’ vast film and TV empire from HBO and HBO Max to century-old studios behind classics such as Casablanca, Citizen Kane, The Wizard of Oz, Friends, Harry Potter, the DC Universe, Game of Thrones, The Big Bang Theory and The Sopranos.

Netflix described the acquisition as a merger of “innovation and legacy,” uniting its globally dominant streaming platform with Warner Bros.’ hundred-year storytelling tradition.

“Our mission has always been to entertain the world,” Netflix co-CEO Ted Sarandos said. “By combining Warner Bros’ incredible library with our culture-defining titles like Stranger Things, Squid Game and Bridgerton, we can give audiences more of what they love.”

Under the agreement, each WBD shareholder will receive $23.25 in cash and $4.50 worth of Netflix stock per share.

The transaction is structured around an equity value of $72 billion and expected to close after WBD completes the planned separation of its Global Networks division, the arm that houses CNN, TNT Sports, Discovery’s free-to-air channels in Europe and digital services such as Discovery+.

Once completed, that separation will create a new public company named Discovery Global, while Netflix takes over the Streaming & Studios division, including Warner Bros., HBO and HBO Max.

Netflix said the deal would not disrupt Warner Bros’ current operations and that it planned to maintain theatrical releases for major films.

Co-CEO Greg Peters said bringing Warner Bros. under Netflix’s umbrella would “accelerate our business for decades,” adding that the combination of Netflix’s global subscriber base with Warner Bros’ production power would “strengthen the entire entertainment industry.”

WBD chief David Zaslav, who has struggled to stabilise the company since the 2022 Discovery and WarnerMedia merger, called the agreement a union of “two of the greatest storytelling companies in the world.”

“For more than a century, Warner Bros has shaped culture,” Mr Zaslav said. “By coming together with Netflix, we will ensure people everywhere continue to enjoy the world’s most resonant stories for generations.”

If approved by regulators and WBD shareholders, the new Netflix–Warner Bros powerhouse could reshape Hollywood by pooling some of the world’s most valuable intellectual property under one platform.

Netflix projects at least $2 to 3 billion in cost savings within the first three years and expects the deal to boost earnings by the second year.

Regulatory reviews, the WBD shareholder vote and the completion of the Discovery Global spin-off mean the deal is unlikely to close before late 2026.

The boards of both companies have unanimously approved the transaction.

The four Warner brothers, Harry, Albert, Sam, and Jack, founded Warner Bros. in 1923.

From a small film studio, it developed into one of Hollywood’s most potent entertainment powerhouses.

‘The Jazz Singer,’ the first full-length motion picture with synchronised dialogue, made the company famous in 1927 and revolutionised the film industry.

Over the years, Warner Bros has produced classics such as ‘Casablanca,’ ‘Rebel Without a Cause’ and ‘The Exorcist,’ and later expanded into global box-office giants including ‘Harry Potter,’ ‘The Lord of the Rings,’ (through New Line Cinema) and the ‘DC superhero universe.’

After multiple mergers, including the 2022 combination of WarnerMedia and Discovery Inc., the company became Warner Bros. Discovery.