Paramount Skydance Raises Stakes for Warner Bros. With $40B Bid
Paramount Skydance has escalated its pursuit of Warner Bros. Discovery (WBD) by amending its acquisition offer with a significant financial backing from Oracle billionaire Larry Ellison. The move serves as a direct challenge to the existing agreement between WBD and streaming giant Netflix.
According to a press release issued Monday, the updated proposal includes an irrevocable personal guarantee from the elder Ellison. This commitment covers $40.4 billion in equity financing for the deal, as well as potential damages claims against Paramount, aiming to eliminate doubts regarding the offer’s viability.
A Competitive Bidding War
The revised offer arrives just one week after the WBD board turned down an initial bid from Paramount, opting instead for a deal with Netflix. That agreement, announced on December 5, carries a total enterprise value of $82.7 billion, utilizing a mix of cash and stock valued at $27.75 per share.
Paramount’s previous attempt to acquire the studio—a $108.4 billion hostile bid at $30 per share—was dismissed by the WBD board. At the time, directors labeled the offer “illusory,” citing concerns over the transparency and security of the proposed financing compared to the Netflix deal, which they described as having “enforceable commitments.”
Strategic Objectives
Paramount Skydance CEO David Ellison claims the new terms directly address the board’s prior skepticism. The company is positioning its $30-per-share all-cash proposal as the most beneficial path for WBD shareholders.
- Financial Backing: The $40.4 billion personal guarantee from Larry Ellison is intended to provide absolute certainty for the equity portion of the deal.
- Strategic Vision: David Ellison argues the acquisition would act as a “catalyst for greater content production” and expand theatrical output.
- Historical Context: This marks the latest attempt by Paramount to secure the studio, following three separate rejections reported by CNBC in October.
“We expect the board of directors of WBD to take the necessary steps to secure this value-enhancing transaction and preserve and strengthen an iconic Hollywood treasure for the future,” David Ellison stated in the release.
Warner Bros. Discovery has yet to provide a formal response to the amended offer.