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Ellison Adds Certainty to Paramount Bid

Paramount Skydance has reinforced its hostile bid for Warner Bros. Discovery by securing the personal backing of billionaire Larry Ellison, addressing doubts raised by the WBD board about the credibility of financial support. Ellison has agreed to provide an irrevocable personal guarantee of $40.4 billion for equity financing and any potential damages claims tied to the transaction.

In addition, Ellison has committed not to revoke or transfer assets from the Ellison family trust during the pending acquisition, adding a layer of security to existing commitments from RedBird Capital and sovereign wealth funds.

Offer Details and Valuation

Paramount’s all-cash offer values WBD at $30 per share, translating to an enterprise value of $108.4 billion—significantly higher than Netflix’s $83 billion deal for WBD’s studio and streaming assets. Paramount did not increase its bid on Monday but raised the proposed reverse breakup fee to match Netflix’s offer, signaling confidence in its proposal.

WBD confirmed receipt of the amended offer and stated it will carefully evaluate the proposal in accordance with its existing agreement with Netflix.

Board Concerns and Shareholder Appeal

Earlier this month, WBD Chairman Samuel Di Piazza expressed skepticism about Ellison’s involvement, noting concerns over whether one of the world’s wealthiest individuals would remain committed through closing. Paramount and RedBird have sought to dispel this uncertainty, emphasizing that Ellison’s support comes through an irrevocable trust anchored by 1.2 billion Oracle shares.

Gerry Cardinale, founder of RedBird Capital, emphasized the straightforwardness of the offer, appealing directly to shareholders: “The board doesn’t own this company. The shareholders do. This should be simple.”

Market Response

Following the announcement, WBD shares rose 3% in early trading, while Paramount’s stock surged more than 7%. Netflix shares declined nearly 1% amid renewed investor focus on the competitive bidding environment.

Paramount has submitted three prior offers in the fall, all of which were rejected. Its persistent approach has pressured WBD to entertain alternative sale options, including Netflix.

Regulatory and Competitive Implications

Paramount has also raised concerns about competition under the Netflix deal. Cardinale argued that a combined Netflix and HBO Max entity could consolidate 420 million subscribers, creating substantial pricing power and prompting concern among creators, talent, and theatrical distributors.

Netflix co-CEOs Ted Sarandos and Greg Peters have maintained that their deal would meet regulatory requirements and preserve WBD’s theatrical slate, while also supporting jobs amid ongoing industry layoffs.

Strategic Positioning

The revised Paramount offer, strengthened by Ellison’s personal guarantee and RedBird’s financial backing, positions the company as a formidable competitor to Netflix in the race for WBD. The next steps will hinge on shareholder decisions and regulatory scrutiny, as both companies prepare for a high-stakes showdown in the entertainment sector.