Paramount Skydance enhanced the terms of its proposed Warner Bros. Discovery takeover deal to include the backing of billionaire Larry Ellison, who would guarantee $40 billion in financing under the new terms, the company announced Monday.
The move directly addresses the concerns raised by the Warner Bros. board over the financing behind Paramount’s $108 billion deal, which it has rejected multiple times since the fall. It has opted instead to accept an $83 billion bid from Netflix that would allow the streaming giant to purchase Warner Bros.’ movie, television and streaming assets.
The Warner Bros. board advised shareholders to reject Paramount’s bid earlier this month, saying in a letter that the $30-per-share offer did not provide adequate value and proposed “numerous, significant risks” to the company. Paramount is financing its offer with help from the royal families of Qatar, Saudi Arabia and Abu Dhabi, but said in filings with the Securities and Exchange Commission that the Middle Eastern financiers would give up voting rights and governance power if the deal were to go through.
“PSKY has consistently misled WBD shareholders that its proposed transaction has a ‘full backstop’ from the Ellison family,” the Warner Bros. Discovery board wrote in the Dec. 17 letter. “It does not, and never has.” PSKY is the Nasdaq ticker for ParamountSkydance Corp., while WBD is the Nasdaq ticker for Warner Bros. Discovery.
Warner Bros. shares jumped Monday morning as news of the revised Paramount deal broke, trading about 3% higher than their Friday closing price. By Monday afternoon shares had fallen.
Paramount’s hostile takeover bid is an Ellison family affair. Larry Ellison, the Oracle co-founder whose net worth is valued at more than $240 billion by Bloomberg, is the father of Paramount CEO David Ellison.
The elder Ellison is the majority asset holder of the family trust, which owns about 1.16 billion shares of Oracle common stock. Warner Bros. has said that a “revocable trust is no replacement for a secured commitment” from the family itself.
But Monday’s offer seeks to address those concerns, with Larry Ellison agreeing not to revoke the trust or “adversely transfer its assets during the pendency of the transaction.”
“Paramount is publishing records confirming that the Ellison family trust owns approximately 1.16 billion shares of Oracle common stock and that all material liabilities of the Ellison family trust are publicly disclosed,” the company said in the news release.
Paramount said it would also raise the chunk of change it would be required to pay Warner Bros. Discovery if the deal is blocked by federal regulators, known as a reverse termination fee, to match the $5.8 billion fee that Netflix pledged. Paramount extended its offer deadline to shareholders until Jan. 21.
Aside from the increase in the breakup fee and Ellison family backing, the financial terms of Paramount’s offer remained the same. The company is sticking to a $30-per-share cash offer for 100% of Warner Bros.’ outstanding shares, which it said is superior to Netflix’s offer of $27.75 per share.
“Paramount has repeatedly demonstrated its commitment to acquiring WBD,” David Ellison said in the news release Monday. “Our $30 per share, fully financed all-cash offer was on December 4th, and continues to be, the superior option to maximize value for WBD shareholders.”
In announcing the hostile takeover bid, the Ellison family-controlled media company said it is “highly confident” in its ability to get regulatory approval for the acquisition, arguing that it could do so faster than Netflix could. That approval would come from the Trump administration. Larry Ellison is personally close to President Donald Trump.
The Trump administration green-lit the Ellison family’s acquisition of Paramount Global, the parent company of CBS News, earlier this year after the network agreed to shell out $16 million to settle a lawsuit brought by Trump over a “60 Minutes” interview with then-Vice President Kamala Harris, the Democratic presidential nominee. Trump sought $20 billion in damages over claims that the Harris interview, which aired during the 2024 presidential race, had been deceptively edited.
With David Ellison at the helm, Paramount Skydance acquired Bari Weiss’ media company, The Free Press, and installed Weiss as editor-in-chief of CBS News.
Weiss’ control over programming at CBS News has since raised questions of objectivity. Weiss pulled a planned “60 minutes” segment on an investigation of allegations of abuse inside the El Salvador megaprison that has received hundreds of Venezuelan migrants from the Trump administration since March.
The decision ignited ethical concerns from viewers and journalists alike. Sharyn Alfonsi, the correspondent who reported the story, said in an email to her CBS colleagues that was obtained first by the New York Times that she believed it was “not an editorial decision” but “a political one.”
If approved, the Paramount-Warner Bros. merger would put the Ellison family in control of CNN, a news network Trump often slams, without evidence, as “fake news.”
Trump publicly involved himself in the competing Warner Bros. bids earlier this month, when he said it was “imperative” that CNN be sold, arguing that its current ownership should not be in charge of the company.
Sydney Carruth is a breaking news reporter for MS NOW.