Paramount revises Warner Bros. bid with $40.4B Ellison guarantee, no price increase
Paramount reaffirmed its hostile $30-per-share tender for Warner Bros. Discovery (about $74.4 billion) without raising the price, but revised the financing by securing Oracle chair Larry Ellison’s irrevocable personal guarantee of $40.4 billion, having David Ellison agree not to revoke or transfer assets from the family trust, extended the tender deadline to Jan. 21 and matched Netflix’s $5.8 billion breakup fee. The offer—which includes WBD’s cable networks like CNN and Discovery—comes after other financing backers (including Affinity/Jared Kushner) exited and directly challenges Netflix’s competing $27.75-per-share studio-and-streaming deal.
đź“Ś Key Facts
- Paramount (Skydance) launched a hostile tender offer for Warner Bros. Discovery at $30 per share in cash (about $74.4 billion equity value), explicitly including WBD’s cable networks (e.g., CNN, TNT/TBS, Discovery properties) that Netflix’s competing studio/streaming deal excludes.
- Paramount did not raise its $30-per-share offer; instead it secured an 'irrevocable personal guarantee' from Oracle chairman Larry Ellison for $40.4 billion of the equity financing, and David Ellison agreed not to revoke or adversely transfer assets from the Ellison family trust while the transaction is pending.
- Paramount increased its proposed breakup fee to $5.8 billion (to match Netflix’s level) and extended the deadline for WBD shareholders to tender into its offer from January 8, 2026 to January 21, 2026.
- Financing/backing changed: Affinity Partners (and associated parties including Jared Kushner) exited exploration of backing for Paramount’s bid, altering the investor mix behind the offer.
- Background competitive context: Netflix struck a separate deal to buy Warner’s studio and streaming business (reported at $27.75 per share in a mixed cash-and-stock structure, with various headline valuations reported), a transaction that excludes cable networks and is expected to face intense multi-jurisdictional antitrust scrutiny.
- Paramount’s management argues its proposal provides a quicker, more certain path to completion; CEO David Ellison has said the bid would allow potential combinations such as merging CNN’s newsgathering with CBS News if the takeover succeeds, while WBD had already been planning a spin-off of its global cable businesses.
- The takeover fight has prompted market and industry reaction — WBD and Paramount shares have moved on the news while Netflix has edged lower, cinema and producer groups have pushed back (warning of theater impacts), and political figures including President Trump have signaled involvement or skepticism over the deals.
đź“Š Analysis & Commentary (2)
Talking myself into a Netflix-Warner merger
"An opinion deep-dive arguing that, despite regulatory and political headwinds and competitive concerns, a Netflix acquisition of Warner Bros. Discovery’s studios and streaming assets can be justified and even preferable to rival bids that cling to legacy cable networks."
Let’s all practice billionaire positivity
"A skeptical commentary pushing back against the reflex to celebrate billionaire backstops — here exemplified by Larry Ellison’s guarantee of Paramount/Skydance financing — arguing such interventions concentrate power, reshape public institutions, and should be critiqued rather than cheerled."
đź“° Sources (9)
Paramount guarantees backing of Larry Ellison in Warner Bros. bid
New information:
- Paramount now says Oracle chairman Larry Ellison will provide an 'irrevocable personal guarantee' of $40.4 billion of the equity financing for its Warner Bros. Discovery bid.
- David Ellison has agreed not to revoke or adversely transfer assets from the Ellison family trust during the pendency of the transaction, addressing concerns raised by the WBD board.
- Paramount did not raise its $30-per-share offer but reiterated its view that this tops Netflix’s mixed cash-and-stock $27.75-per-share bid.
- Paramount increased its proposed breakup fee to match Netflix’s $5.8 billion level (up from its prior $5 billion).
- The deadline for WBD shareholders to tender into Paramount’s offer was extended from Jan. 8 to Jan. 21.
Jared Kushner pulls out of Paramount’s hostile bid for Warner Bros. Discovery
New information:
- Confirms financing shift: Affinity Partners has exited the Paramount bid it initially explored backing, changing the bid’s investor mix.
- Reiterates Paramount’s direct‑to‑shareholders tender structure and price differential vs. Netflix ($30 vs. $27.75) with the inclusion of cable networks.
- Notes Paramount’s argument on regulatory viability under the current administration and Trump’s public skepticism of the Netflix–WBD deal.
CNN and fellow cable networks are in limbo amid takeover bids of Warner Bros. Discovery
New information:
- Paramount Skydance CEO David Ellison said on CNBC he would combine CNN’s newsgathering operation with CBS News if the WBD bid succeeds.
- Paramount’s offer includes WBD’s cable networks (e.g., CNN, Discovery, HGTV, Food Network, TLC) that were excluded from Netflix’s studio/streaming deal, raising the prospect of a CNN–CBS News combination.
- CNN CEO Mark Thompson told staff a 2026 budget for CNN’s digital subscription push has already been approved by the intended Discovery Global spinoff, signaling plans are moving ahead despite ownership uncertainty.
- Warner Bros. Discovery had planned to spin off its cable networks into a separate company prior to the Netflix announcement.
- Article notes Trump’s mixed posture: allied with Ellison family but recently angered at a '60 Minutes' segment, adding political context to potential regulatory reception.
Paramount offers Warner Bros. shareholders $74.4 billion for the company, challenging Netflix’s deal
New information:
- Paramount initiated a hostile tender offer to WBD shareholders for $30 per share in cash (~$74.4 billion equity value).
- Paramount’s bid includes WBD’s cable assets (e.g., CNN/Discovery), contrasting with Netflix’s deal structure that excludes cable networks.
- Paramount claims its proposal is about $18 billion higher than Netflix’s and criticizes Netflix’s valuation of cable assets.
- Tender offer set to expire Jan. 8, 2026 unless extended.
- Paramount argues Netflix’s proposal faces a lengthy, uncertain multi-jurisdictional regulatory process; CEO David Ellison issued a statement touting increased competition and theatrical output.
- President Trump said he will be involved in the approval decision and that the Netflix–WBD deal 'could be a problem' due to size.
- Market reaction: WBD and Paramount shares rose ~5–6% at the open; Netflix edged lower.
Paramount Skydance makes $108.4 billion bid for Warner Bros. Discovery
New information:
- Paramount Skydance made an unsolicited $108.4 billion all-cash offer for Warner Bros. Discovery.
- The offer was made three days after Netflix agreed to buy Warner Bros. for $82.7 billion.
- CEO David Ellison said the bid offers 'a more certain and quicker path to completion.'
What Netflix’s deal to buy Warner Bros. means for one of Hollywood’s oldest studios
New information:
- PBS reports Warner Bros. would spin off specific cable networks — CNN, TNT and TBS — before the deal closes.
- Article highlights expected intense antitrust scrutiny from the Trump Justice Department.
- Notes Netflix beat Paramount and Comcast in a bidding war for Warner Bros.
- Identifies key franchises Netflix would gain access to: DC Universe, Game of Thrones and Harry Potter.
- Adds industry pushback details: an open letter from film producers to Congress warning of 'cascading disastrous outcomes' and WGA opposition.
Netflix wins bidding war for Warner Bros. purchase
New information:
- CBS reports Netflix announced a deal to buy Warner Bros. for $82.7 billion.
- The report characterizes the outcome as Netflix 'winning a bidding war,' indicating a competitive process.
- The announced price is materially higher than the earlier reported $72 billion figure.
Netflix to acquire Warner Bros. studio and streaming business for $72 billion
New information:
- Closing timeline specified: transaction expected after Warner separates its Discovery Global cable operations in Q3 2026.
- Cinema United, representing 30,000 U.S. and 26,000 international screens, formally opposes the deal and urges regulators to scrutinize it, warning of theater closures.
- Premarket reaction: Warner Bros. Discovery shares up nearly 3%; Netflix and Paramount down more than 2%.
- Netflix reiterates it will continue theatrical releases for Warner studio films, honoring contractual agreements (restated with added context).
- On‑the‑record statements from David Zaslav and Ted Sarandos framing the strategic rationale.