Netflix-Warner Bros Deal: Netflix will have to pay $5.8 billion if the deal is broken, know the whole story

By Samira Vishwas On Dec 6, 2025

Netflix-Warner Bros Deal: Netflix Inc. Warner Bros. Discovery Inc. Is buying TV, film studios and streaming divisions. The price of this deal is $72 billion. A breakup fee of $5.8 billion has been fixed for this deal. If Netflix ends this deal or it does not get regulatory approval, then Netflix will have to pay this amount to the target i.e. the seller.

According to Bloomberg, this breakup fee is 8% of the equity value of the deal. Fixing such a huge amount as breakup fee shows that Netflix officials are confident that they will not let this deal fall apart.

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Netflix-Warner Bros Deal

This multi-billion-dollar commitment by Netflix also shows how tough the bidding was to buy Warner Bros. Discovery’s TV, film studio and streaming divisions.

Paramount Skydance Corp. Was also in the race to buy it. Earlier this week, Paramount Skydance more than doubled the proposed breakup fee in its offer to $5 billion.

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$2.8 billion in reverse breakup fees (Netflix-Warner Bros Deal)

Under the terms of the deal, a reverse breakup fee of $2.8 billion is set for Warner Bros. If the company’s shareholders vote against the deal, then Warner Bros. will have to pay this amount to Netflix.

However, if Warner Bros. accepts another buyer’s offer, the new buyer will have to pay this penalty. Warner Bros. Discovery’s film studios have given the world cinematic gems like Harry Potter, The Dark Knight Trilogy, The Matrix, The Lord of the Rings and the DC Universe. Biggest breakup fee in deals so far

According to data gathered by Bloomberg, some of the largest breakup fees in the history of mergers and acquisitions are as follows…

AOL/Time Warner Inc: The price of this deal was $160 billion. America Online Inc. Time Warner Inc. Had agreed to pay a fee of approximately $5.4 billion for withdrawing from its agreement to buy. The reverse breakup fee for Time Warner was approximately $3.9 billion. This deal was completed.

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Pfizer/Allergan: The price of this deal was $160 billion. The breakup fee could have been as much as $3.5 billion. However, the merger included a clause that the fees would be reduced if the tax laws changed. This deal was not completed. After the US cracked down on corporate tax inversions, Pfizer paid just $150 million.

Verizon/Verizon Wireless: In this $130 billion deal, the breakup fee was $10 billion. The deal was for Verizon to purchase Vodafone’s stake in Verizon Wireless. If Verizon had failed to obtain financing for the deal, it would have had to pay this amount to Vodafone.

If its board had changed its recommendation to shareholders to vote in favor of the transaction, the breakup fee would have been $4.64 billion. The reverse breakup fee for Vodafone was $1.55 billion. If shareholders had rejected the transaction, either party would have had to pay the other party $1.55 billion. If the negative tax ruling had made it difficult to complete the deal, Vodafone would have also had to pay that $1.55 billion. This deal is completed.

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AB InBev/SAB Miller: The price of this deal was $103 billion and it was completed. The breakup fee for AB InBev was $3 billion.

AT&T/T-Mobile USA: In this $39 billion deal, the breakup fee for AT&T was $3 billion. AT&T agreed to pay a breakup fee to Deutsche Telekom as well as transfer radio spectrum to T-Mobile and enter into a more advantageous network-sharing agreement. This deal was not completed due to regulatory opposition.

Google/Waze: This $32 billion deal was completed. The companies had agreed that if the deal was not completed, Google would pay a breakup fee of approximately $3.2 billion.