Netflix just announced that it has declined to raise its offer for Warner Bros. Netflix had earlier received notice from Warner Bros. Discovery (WBD) that its Board of Directors has determined Paramount Skydance’s (PSKY) latest proposal constitutes a “Superior Proposal” under the terms of WBD’s existing merger agreement with Netflix. Netflix issued the following statement in response from co-CEOs Ted Sarandos and Greg Peters:

The transaction we negotiated would have created shareholder value with a clear path to regulatory approval. However, we’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid.

Warner Bros. is a world-class organization, and we want to thank David Zaslav, Gunnar Wiedenfels, Bruce Campbell, Brad Singer and the WBD Board for running a fair and rigorous process. We believe we would have been strong stewards of Warner Bros.’ iconic brands, and that our deal would have strengthened the entertainment industry and preserved and created more production jobs in the U.S. But this transaction was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.

Netflix’s business is healthy, strong and growing organically, powered by our slate and best-in-class streaming service. This year, we’ll invest approximately $20 billion in quality films and series and will expand our entertaining offering. Consistent with our capital allocation policy, we’ll also resume our share repurchase program.

We will continue to do what we’ve done for more than 20 years as a public company: delight our members, profitably grow our business, and drive long-term shareholder value.

There have been a lot of people in Hollywood who worried about what would happen to the Warner Bros. Studios under a Netflix ownership. This falls into the FAFO territory, because given the $100 billion or so worth of debt this new company will have on its books once the merger is over, we’re likely to see cost cutting and carnage worse than most people thought possible.I am truly sorry this was the resolution. I think Netflix would have been a good steward for the Warner Bros. name.One story I am looking forward to seeing play out is finding out what happened today at the meeting Netflix co-CEO Ted Sarandos had with the White House. I wonder if the feedback he received at meeting helped make this decision for him.And I guess this is good news for Susan Rice.